Police said that they suspect the former CEO had fraudulently disbursed loans to 56 people without having followed due procedure in allotting these. (File photo)The Mumbai police have arrested the former chief executive officer (CEO) of City Cooperative Bank for allegedly causing a loss of around Rs 96 crore to the bank by sanctioning credit to ineligible people and companies.
Along with the former CEO Ramesh Shirgaonkar (79), the police also arrested a businessman Rajan Sawant (41) who allegedly connived with him. According to the police, Sawant provided fake documents and availed credit worth Rs 11 crore from the bank.
An officer said that they suspect Shirgaonkar to have fraudulently disbursed loans to 56 people without having followed due procedure in allotting these. In the case of Sawant, Shirgaonkar allegedly did not conduct a proper inspection of his outstanding loans before providing the credit facility.
An officer said that apart from this, the loan file submitted by Sawant did not include several necessary documents like the share certificates of the cooperative society, no-objection certificate (NOC) for mortgage and sanctioned building plans among other things. An official said that it was during an investigation it came to light that Shirgaonkar approved loans of Sawant and 55 others without proper documents.
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An official said that the two accused were produced before the court and remanded to the custody of the Economic Offences Wing which is conducting an investigation in the case.
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