CBI books Frost Int’l for ‘cheating’ banks of ₹4K-cr

PROMOTERS UDAI JAYANT DESAI, SUJAY UDAI DESAI, SUNIL LAL CHAND VERMA AND ANOOP KUMAR WADHERA ARE AMONG THE 14 PEOPLE NAMED AS ACCUSED IN FIR

NEWDELHI: The Central Bureau of Investigation (CBI) has filed a case against Frost International Ltd, a Mumbai-based company involved in merchant trading, import and export of various commodities, and its promoters for cheating a consortium of banks led by Bank of India (BOI) of ~4061 crore in 2011.

Promoters Udai Jayant Desai, Sujay Udai Desai, Sunil Lal Chand Verma and Anoop Kumar Wadhera were among the 14 people, including directors and guarantors of the company, who have been named as accused in the FIR. Look out circulars (LOC) have also been issued against all of them at airports and entry-exit points across India so that they don’t leave the country.

Apart from BOI, Bank of Baroda (BOB), Canara Bank, Central Bank of India, Andhra Bank, Oriental Bank of Commerce, Punjab

National Bank, Syndicate Bank, Union Bank of India, Indian Overseas Bank, UCO Bank, Vijaya Bank, Allahabad Bank and the United Bank of India are the other banks in the consortium. According to a complaint filed by Bank of India’s Kanpur branch, which is now part of the probe agency’s FIR, Frost International has been banking with it and banks in the consortium since 1996.

The FIR says that in the loans taken from the consortium, BOI has the highest exposure of Rs 756 crore which the company has not repaid. A forensic audit conducted by the banks found that there was a potential diversion of funds by way of providing unsecured loans to group companies and that there was no actual export of goods against merchant trade transactions.

It also found purchases and sales took place among parties known to each other and that the majority of payments towards sales were received from third parties and not from the parties to whom goods were sold.

The company is engaged in trading of multiple agro commodities, minerals and metals, bullion, polymer, chemical and petro products, plastic, textiles and other items.

Frost International Ltd’s registered office is in Bandra Kurla Complex, Mumbai, its head office and international marketing division is in Hospitality District, New Delhi and the corporate office is in Kanpur.