CBI books ex-chairman of J&K Bank in fraud case

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New Delhi, March 19

The CBI has registered an FIR against Jammu & Kashmir (J&K) Bank ex-chairman Mushtaq Ahmad Shaikh and 18 others in a case relating to causing loss of Rs 800 crore to the public sector lender on account of loans to REI Agro, which were approved without tangible security and on fake documents. In the FIR, a copy of which is with The Tribune, the CBI, in addition to bank officials, has also named REI Agro chairman Sanjay Jhunjhunwala and vice president and managing director Sandeep Jhunjhunwala.

Officials said the case was earlier probed by J&K’s anti-corruption branch and it had found that loans worth Rs 800 crore were sanctioned to the group on the basis of fake documents between 2011 and 2013 and in violation of guidelines.

The CBI FIR alleges that the Mumbai-based Mahim branch of the bank sanctioned Rs 550 crore of loans while the Vasant Vihar branch in Delhi sanctioned Rs 139 crore in their favour against the supplier bill discounting facility and takeovers.

“The farmers were supposed to provide paddy to the company, in turn the company had to sell the produce (paddy) and the remittance thereof had to be deposited in the bank as installments against advances received by the company,” the FIR read.

But this was brazenly violated by the company in connivance with the bank authorities, who allowed disbursement of loan through joint liabilities groups (JLGs), though the company had already received paddy and was not entitled to disburse the loan under such circumstances, officials alleged.