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In the aftermath of the Punjab and Maharashtra Co-operative (PMC) Bank scam, the loans extended by the lender, often in an arbitrary and unregulated manner, emerged as the root cause.
It has now come to the fore that real estate firm Housing Development Infrastructure Ltd (HDIL) – which was the primary beneficiary of such loans – and its promoters invested the money in a number of companies with questionable financials.
According to an Indian Express report, Rakesh and Sarang Wadhawan, promoters of HDIL, invested Rs 174 crore in two Mauritius based companies: Sunsara Investments Ltd and Sunshine Overseas Ltd between 2010 and 2014.
The investments were made by another company by the name Privilege Oil & Gas Pvt Ltd, which was in turn, promoted by Wadhawans.
The report further says that besides HDIL, at least 16 firms linked to the Wadhawans borrowed Rs 2,042.45 crore from PMC Bank. A significant part of this money was then ultimately used to invest in HDIL by allegedly routing it through multiple related entities.
The crisis in the PMC Bank has also raised questions on the regulatory framework of the Reserve Bank of India (RBI). Against the backdrop of the Punjab National Bank (PNB) scam that hit the banking system in February 2017, the central bank's safeguards against frauds have once again come under the scanner.
The report also says that a number of fictitious bank accounts were created in the names of people who had passed away or had wound up their accounts with the bank, to facilitate these loans.
(With inputs from Indian Express)
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