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Sunday, April 29, 2012

Castor oil Loan Scam 1100Cr detected by Central Vigilance comission

The Central Vigilance Commission has unearthed a large scale fraud committed by a private firm by allegedly misusing Rs 1,100 crore loan taken from different nationalised banks and wrongly claiming its end-use.
CVC officials said the firm was taking loans from various banks with the stipulations that it will be used by farmers of different states for growing and supplying castor seeds.

During  a detailed scrutiny, the Chief Vigilance Officer of Bank of Maharashtra noticed irregularity and found that the firm has perpetrated an alleged fraud of Rs 50 crore. "The matter was brought to the notice of other banks and the Commission which found that the total amount involved in the whole case is Rs 1,100 crore," a CVC official said. He said that a consortium of nine banks have lent to the firm.

"The loan amount has been siphoned off through Village Level Aggregators appointed by the company. The account has become Non-Performing Asset and has been declared as fraud,"  the official said refusing to divulge further information. The Commission advised the banks to ensure that staff accountability be fixed in the case and has asked them to get the case registered with CBI. "The CBI has been directed to register
the case and investigate the matter," he said.An email query on the matter sent to Bank of Maharashtra and other banks did not yield any response.

"It is a serious fraud. The firm has wrongly claimed that the loan amount was being used by the farmers. We are awaiting CBI's preliminary enquiry report on the matter," the official added

Conclusion: This is not good news.. There were no names mentioned but considering the size of Jayant Agro in the castor business it is a cause for concern. hopefully the whole of udeshi family is involved in day to day running of Jayant Agro and will be able to prevent this scam from impacting Jayant Agro. News has been reported in major news papers in April 22,2012 onwards.


Link to news Item: Link1 , Link 2

4 comments:

Anonymous said...

WhatsUP ji:

In November 2011, there was a similar scam of 1500 crore reported. It was NOT Jayant Agro. I don't want to name that company here.

I've checked Annual Report of JAOL. Bank of Maharashtra is not their bankers.

As you said, lets hope & keep fingers crossed that is not JAOL or its subsidiaries.

What'sUp Prahalad said...

Anonymous ji:

Last scam as far as I can remember it was with regards to BIOTOR (Jayant Oil) BIOTOR is bankrupt as per my understanding..

I had also checked in A.Report of jayant, Bank of Maharashtra is not one of the bankers ;-)) for jayant..

Lets see .. keeping my fingers crossed.

=happy investing
whatsup-indianstockideas.blogspot.com

Anonymous said...

Please see this January 2011 news story. The wording are very very similar to what you have shared today.

And yes, Bank of Maharashtra too.

http://www.indianexpress.com/news/biotor-industries-in-rs-1-500-cr-fraud/742090/

What'sUp Prahalad said...

Anonymous ji:

lets see how this new case proceeds..
I dont think it is Jayant.. because.. why would the promoters increase stake if there were issues like this in the background..

But then "never say never" lets wait for more news to flow out

=happy investing
whatsup-indianstockideas.blogspot.com