The CBI on Monday registered an FIR against Rotomac Pens Chairman and MD Vikram Kothari for purportedly swindling Rs 800 crore from five state-owned banks.
Kothari, his wife and son have been taken into CBI custody for questioning. However, PTI reported that no arrests have been made in the case so far.
The agency has also been conducting searches at Kothari’s residence and offices in Kanpur since earlier in the day.
The Kanpur-based company’s owner had taken loans of Rs 800 crore from Allahabad Bank, Bank of India, Bank of Baroda, Indian Overseas Bank and Union Bank of India. However, as per the Union Bank of India and Allahabad Bank sources, Kothari has not paid back either the interest or the loaned amount.
Insiders in the banks said rules were “compromised” to give loans to Kothari, who rented Rs 485 crore from Mumbai-based Union Bank of India and a loan of Rs 352 crore from Kolkata-based Allahabad Bank.
Reacting to reports that he had fled the country to evade arrest, Kothari issue a statement on Sunday saying he was very much in Kanpur.
Rotomac was announced a “willful defaulter” by the Bank of Baroda, vide an order dated February 27, 2017 passed by an authorised committee, as per the process laid down by the Reserve Bank of India.
The development comes less than a week after Punjab National Bank (PNB) had detected an Rs 11,400 crore scam wherein billionaire jeweller Nirav Modi allegedly acquired fraudulent letters of undertaking (LoUs) from a branch in Mumbai to secure overseas credit from other Indian lenders.
The PNB fraud pertains to issuance of fake LoUs to companies combined with Modi by errant PNB employees, which enabled these companies to raise purchaser credit from international branches of other Indian lenders.
Both Modi and Choksi fled the country before the bank realised the depth of the alleged crime.