New India Co-op Bank Fraud: Ex-CEO Quizzed by EOW

Mumbai, Feb 19 (PTI) Mumbai Police's Economic Offences Wing (EOW), probing a Rs 122-crore embezzlement at New India Co-Operative Bank Ltd, on Wednesday recorded the statement of a former Chief Executive Officer (CEO) of the lender, officials said.
The former CEO was quizzed for several hours, an EOW official said without providing details.
The EOW has also asked Abhimanyu Deshmukh, partner at a chartered accountancy firm linked to the bank in the past, to record his statement in the case on Thursday, an official said.
The CA firm had audited annual accounts of the bank in 2019-2020, he said.
Investigators are trying to under why embezzlement of such a huge amount did not come to light earlier as the misappropriation of funds was going on for the last five years, a period which coincided with the coronavirus pandemic, he said.
Accordingly, they are recording statements of various related persons, including present and past executives of the crisis-ridden bank, the official maintained.
The EOW has arrested Hitesh Mehta, former General Manager and Head of Accounts at New India Co-Operative Bank, in connection with the Rs 122-crore fraud. The probe agency has also arrested a developer, Dharmesh Paun, to whom accused Mehta had allegedly given Rs 70 crore to complete an SRA (slum rehabilitation authority) project at Charkop in Mumbai's western suburbs.
As per the police, Devarshi Ghosh, the bank's acting chief executive officer, lodged a complaint against Mehta and others at the Dadar police station in central Mumbai on Friday last for alleged misappropriation of the lender's funds.

Based on the complaint, the police registered a case in the early hours of Saturday, and the probe was transferred to the EOW.



The complainant alleged that Mehta and his associates hatched a conspiracy and embezzled Rs 122 crore from the safes of Prabhadevi and Goregaon offices (in Mumbai) of the bank.

A case under sections 316 (5) (criminal breach of trust by public servants, bankers, and others in positions of trust) and 61(2) (criminal conspiracy) of the Bharatiya Nyaya Sanhita (BNS) has been registered.

The Reserve Bank of India (RBI) on Friday superseded the cooperative lender's board for a year and appointed an administrator to manage its affairs.

A day prior to that, the RBI imposed several restrictions on the lender, including on the withdrawal of funds by depositors, citing supervisory concerns emanating from the recent material developments in the bank, and to protect the interest of its depositors.