Page 20 - Banking Finance October 2020

CO-OPERATIVE BANK NEWS

Co-Operative Bank News

ED arrests accused in Rs. of the 20 firms. They were identified Manager of Nabard to respond to the
as S J Securities Limited, Pioneer Mer- queries raised by the Cooperative Bank
25.25-crore cooperative cantile Limited, Vitale Bio Science Lim- Employees Union on the merger issue.

bank fraud case ited, Satark Real Estate Limited, Jupi- In their letter, the employees' union
The Enforcement Directorate (ED) has ter Business Limited, Lakshya Securi- has demanded to expedite the merger
arrested NiketaBaldevbhai Dave, a di- ties & Credit Holding Limited and process of the DCCBs with State Coop-
rector of Pentium Infotech Limited and Arihant Jewellers. erative Bank. There are 1,335
Hirak Biotech Limited, in connection The two accused, as directors of Hirak branches of DCCBs and 29 branches of
with an alleged fraud of Rs. 25.25 crore Biotech Limited, passed a board reso- UP State Cooperative Bank in State.
in the Ahmedabad People's Coopera- lution on February 25, authorising Ms. The merger will strengthen the 7,439
tive Bank Limited. Dave to enter into any transaction re- PACCs in the state, the letter reads.
lated to the non-agricultural land in
The agency has secured four days' cus- M V S Rami Reddy (IAS) Additional
Sachana held in the company's name.
tody of the accused from a special Chief Secretary, Department of Co-op-
Based on the resolution, she allegedly
court in Ahmedabad. The case is based eration, said that the report of the
executed sale deeds in March to trans-
on the investigation conducted by the committee for merger is being consid-
fer the properties without receiving
CID-Crime of Gandhinagar Zone. It was ered at the government level.
any consideration, it is alleged.
alleged that Ms. Dave, another direc- Several union office bearers in districts
tor Pratik R. Shah, and others were in- had written letters to UP Chief Minis-
volved in the fraud. Co-op banks merger in ter Yogi Adityanath in this connection.
UP: Finance Ministry seeks
According to the ED, the accused per- Readers would recall that earlier, the
sons opened overdraft accounts against update from Nabard RSS leaning body's SahakarBharati had
fixed deposits in the cooperative bank. The Ministry of finance has written a opposed the idea of merging district
The companies defaulted on repay- letter to Nabard Chief General Man- Central Cooperative Banks of Uttar
ments, causing a loss of Rs. 25.25 crore ager on the issue of merger of the dis- Pradesh with the State Cooperative
to the bank. Mr. Shah had also opened trict central cooperative banks of Uttar Bank. The leaders argued that the idea
20 IBL accounts with the bank, having Pradesh with State Cooperative Bank. of merging the DCCBs will stifle the ru-
Rs. 50.00 lakh sanctioned to each ac- The copy of the letter is with Indian ral credit system. It will be against the
count, in the name of his office staff, Cooperative. three-tier structure as well.
firms and associates.
The letter signed by the Under Secre- There are 50 DCCBs in the state out of
Ms. Dave, as a director/proprietor/ tary, Pramod Kumar Singh, Ministry of which 16 have a weak financial back-
partner, then applied for loan for seven Finance has asked the Chief General ground. Even the district cooperative

20 | 2020 | OCTOBER | BANKING FINANCE