Banking

PMC Bank Scam: Ex-BJP MLA's Son and Bank Director Rajneet Singh Arrested

He was arrested by the Mumbai Police's Economic Offences Wing as his replies, on the loan granted to the realty group HDIL, were found "unsatisfactory and unconvincing".

Mumbai: One of the directors of the scam-hit Punjab and Maharashtra Cooperative (PMC) Bank, Rajneet Singh, son of ex-BJP MLA Sardar Tara Singh, was on Saturday arrested by the Mumbai Police’s Economic Offences Wing (EOW), an official said.

Rajneet was taken into custody in the evening at the EOW office, as investigators found his replies on the loan granted to the realty group HDIL, which has failed to repay, unsatisfactory and unconvincing, according to the official.

Besides being a director, Rajneet is also a member of the loan recovery committee of the bank, he said.

Rajneet was questioned over the loan provided by the bank to HDIL group companies and the steps taken, if any, to recover the pending dues, the official added.

“Rajneet provided unsatisfactory and unconvincing explanations, which hints at his likely role in the scam,” he said, adding that Rajneet will be produced before a holiday court and his police remand will be sought.

Also read: After Depositors, the PMC Scandal’s Second Potential Victim is Trust in India’s Financial System

So far, nine persons have been arrested in connection with the alleged Rs 4355-crore scam including three top bank officials and two promoters of HDIL – Rakesh and Sarang Wadhawan, and auditors.

The EOW suspects a nexus between some of the accused and the realty group HDIL, whose mammoth loan defaults are said to have caused a liquidity crisis at the bank, leading to the appointment of an administrator by the RBI and restrictions on the bank on withdrawal of funds.

The EOW had earlier told a sessions court that a prima facie nexus between some of the accused and HDIL group companies has been detected by the investigators who suspected a “deep-rooted conspiracy”.

Six people have died due to loss of money, it had said.

Tara Singh had served as the MLA from Mulund constituency in Mumbai.