The CBI has booked Kanpur-based businessman Vikram Kothari, his wife and son in connection with the alleged swindling of Rs 3,695 crore of loan funds advanced by a consortium of seven banks to his company Rotomac Global Pvt Limited.
The banking scam has surfaced in the backdrop of Rs 11,384 crore alleged fraud reported by Punjab National Bank, involving billionaire Nirav Modi and his uncle, Mehul Choksi.
Rotomac Global Pvt Limited was given bank loans worth Rs 2,919 crore from 2008 onwards by a consortium of banks led by Bank of India which have swelled to Rs 3,695, including the accrued interest, because of repeated defaults on payment, the officials said.
The principal exposure of the banks with regards to the loan is Bank of India Rs 754.77 crore, Bank of Baroda Rs 456.63 crore, Overseas Bank of India Rs 771.07 crore, Union Bank of India Rs 458.95 crore, Allahabad Bank Rs 330.68 crore, Bank of Maharashtra 49.82 crore and Oriental Bank of Commerce Rs 97.47 crore, they said.
The loans were being advanced to the company from 2008 onwards, the Bank of Baroda has alleged.
The case against Rotomac Global Pvt Limited, its directors Vikram Kothari, his wife Sadhana Kothari, and son Rahul Kothari and unidentified bank officials was filed on a complaint received from Bank of Baroda, they said.
The agency searched three locations in Kanpur, including Kothari's residence and office premises.
There have been no arrests in the case yet, CBI spokesperson Abhishek Dayal categorically said.
He said Kothari, his wife and his son were examined by the CBI, which is conducting the searches.
"The total outstanding amount of the members of consortium of banks has come to Rs 3,695 crore of bank loan which was siphoned off by the said company," Dayal said in a statement.
He said a residential apartment and office premises of the accused in Delhi have been sealed.
It is alleged that loans were being siphoned off by diverting them from the purpose for which they were taken.
The company adopted two different methods for diverting the funds--loans for exports were round tripped from abroad and loans taken for purchasing export goods were used domestically without executing any export order.
In a case, the company was given loan to export wheat to Singapore but it is alleged that Kothari transferred the money to a Singapore-based company Bargadia brothers which sent remittances back to the account of Rotomac Global without any export on ground.
In some other cases, money disbursed by the banks for procurement of goods to export was not utilized and no export order was executed by the company.
These are violations of the Foreign Exchange Management Act, misappropriation of funds and criminal breach of trust as the funds given by the banks for specific purposes should be used for the same.
The banks have alleged most of the transaction of this company was with limited number of buyers, sellers, sister companies and subsidiary of the company with no genuine business activities.
It is also alleged that the company was using shell companies for carrying out this alleged round tripping operation and had also submitted fake and forged documents to "induce" banks to advance money to it.