Mahindra Fin detects `150 cr fraud in loan portfolio, defers FY24 results till May 30

Mahindra Finance on Tuesday said it had in March detected about Rs 150 crore fraud in its loan portfolio at one of its branches and has postponed finalisation of results for the fourth quarter and also for the financial year till May 30. Mahindra & Mahindra Financial Services board was scheduled to meet on Tuesday to approve the financial results for the March quarter and 2023-24 fiscal year.

In a regulatory filing, the company said a the board meeting to consider financial statements, results and dividend for the period ended March 2024 is re-scheduled and will be held on May 30, 2024.

The board of Mahindra & Mahindra Financial Services, which met earlier in the day, approved a hike in borrowing limit to Rs 1.30 lakh crore and also decided to appoint M M Nissim & Co LLP and M P Chitale & Co as the Joint Statutory auditors of the company for a period of three years. They will replace Deloitte Haskins & Sells and Mukund M. Chitale & Co upon completion of their 3-year term at the ensuing 34th AGM to be held later in the year.

Mahindra Finance said during the end of the fourth quarter of the financial year ended March 31, 2024, a fraud was detected at one of the company's branches in the northeast.

"In respect of retail vehicle loans disbursed by the company, the fraud involved forgery of KYC documents leading to embezzlement of company funds.

The investigations in the matter are at an advanced stage. The company estimates that the financial impact of this fraud is unlikely to exceed Rs 150 crore," Mahindra Finance said. Investigations are underway, and necessary corrective actions have been identified and are at various stages of implementation, including the arrest of a few persons involved, it added.