The Economic Offences Wing (EOW) of the Mumbai Police on Wednesday arrested Surjit Singh Arora, a former director of the Punjab and Maharashtra Cooperative (PMC) Bank, in connection with its ongoing investigation into the alleged fraudulent loans issued to the Housing Development and Infrastructure Limited (HDIL) group.
The EOW has so far arrested HDIL promoters Rakesh and Sarang Wadhawan , former PMC managing director Joy Thomas and former chairman Waryam Singh , all of whom are in judicial custody. The bank has allegedly sustained losses of ₹4,335 crore after its officials sanctioned large amounts of unsecured loans to the Wadhawans.
Police officials said Mr. Arora was brought to the EOW office on Wednesday morning for inquiries. “We found evidence to indicate that money was transferred from HDIL’s accounts to his private account. He was arrested after he was unable to provide a satisfactory explanation for this in his questioning,” an EOW officer said.
Audit flaw
Meanwhile, Mumbai Police Commissioner Sanjay Barve on Wednesday afternoon met depositors of the bank, who had been protesting outside Esplanade court earlier in the day.
Mr. Barve assured depositors that no culprit will be spared and that investigations were under way from all angles.
“I myself used to be a banker, and the EOW’s banking unit is quite adept at handling such cases. In the normal course, an audit by the Reserve Bank of India or any other body should reveal the anomalies that have come to light in the probe, and we are finding out why this did not happen,” Mr. Barve said to the depositors at the Mumbai Police headquarters.
He said, “We have also seen that the loans were not directly issued in the name of HDIL, but were debited as personal loans to fictitious accounts. We are investigating how such a disproportionate rise in personal loans went unnoticed by any of the regulators. Lookout circulars have already been issued in the names of the directors, and property worth ₹4,056 crore has been attached.”
‘Unconditional consent’
In another development, the Wadhawans, through their lawyers, wrote to the EOW and the Enforcement Directorate (ED) on Wednesday, asking them to liquidate the assets that have been attached so far.
“We urge the ED and the EOW to take timely action by disposing of the assets to get the fair market value for the same. We further give our unconditional consent for the appropriation of the money received from the sale of these assets to be adjusted and appropriated towards the principal loan amount procured by us. It is in the larger public interest that the assets are disposed off so as to mitigate the present situation,” the letter said.
