UCO Bank: ~7.6-bn provisioning done against reported fraud
Government-owned UCO Bank told the stock exchanges on Monday it had already provided ~7.57 billion on its balance sheet as provisioning against a bad loan account involving its former chairman, Arun Kaul.
During the weekend, the CBI booked Kaul, the lender’s former chairman and managing director (CMD), and some others in connection with an alleged ~6.21 billion loan fraud. This is supposed to have caused a loss of ~7.37 billion to the bank. UCO Bank says the account in question was classified as nonperforming since July 1, 2013. It had registered a complaint with the CBI last Wednesday, against Era Engineering Infra India (EEIL), in view of the irregularities reported in the account, the bank said. CBI had searched 10 locations in Delhi. Besides Kaul, it has booked EEIL, the latter’s chairman, Hem Singh Bharana, and two chartered accountants (CAs), Pankaj Jain and Vandna Sharda. Also, Pawan Bansal of Altius Finserve, among others.
Fraud of ~6.21 billion by diversion and siphoning off the bank loans is alleged. Kaul was CMD of the Kolkata-based-bank between 2010 and 2015. He is alleged to have facilitated the company in getting the loan.