Central Bureau of Investigation (CBI) on Friday filed a charge-sheet in the Court of Additional Chief Metropolitan Magistrate in Chennai against the then chairman of Chennai based private company and others for causing a loss of approximately Rs 102.87 crore to Syndicate Bank.
The name of the accused is A.C. Muthaiah, the then Chairman of M/s First Leasing Company of India Ltd., Chennai; Farouk M. Irani, the then Managing Director of the same company and 23 others.
It was alleged that the said Chennai based Company was banking with Syndicate Bank since 2004. The accounting database maintained was in 'Oracle' which allowed the said Company to alter or manipulate it through back-end process.
It was further alleged that the company had been showing inflated income as well as inflated assets over the years (since 1998) by showing fictitious income and non-existing assets. Most of the loans shown as granted by the said Company to their clients were allegedly fictitious.
According to the CBI, the loans availed from the banks were allegedly diverted to the shell companies controlled by the then Managing Director to acquire shares of the said company only. It was also alleged that the NPAs of said Company were shown to be taken over by these shell companies through bogus agreements to avoid NPA provisions resulting in inflated profits, thereby causing loss of Rs.102.87 crore (approx.) to Syndicate Bank.
The probe also revealed that the said accused persons along with seven satellite/ shell companies in furtherance of a conspiracy with statutory and internal auditors had allegedly cheated the bank by submitting forged financial statements to obtain undue credit limits and syphoned the same away for extraneous uses whilst causing wrongful loss of approximately Rs. 102.87 crores to the bank.
The probe has also disclosed that the Promoter-Directors had allegedly misappropriated the assets of the company entrusted to them by using such loaned money to donate annually to a Trust run by the said accused.
After a thorough investigation, the CBI has filed a charge-sheet.
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