Page 21 - Banking Finance December 2019

CO-OPERATIVE BANK NEWS

Goa State Co-op bank 37 members of co-op bank booked by Shivajinagar
set to reopen VKS societ- police for forging
ies As much as 37 members of a cooperative bank, inclusive of the chairman, have
been booked by Shivajinagar police in the context of al-
The Goa State Cooperative Bank legedly forging documents and cheating the financial in-
(GSCB) is plan- stitution to the tune of Rs 24.40 crore.
ning to reopen
the 80-90 Vikas “The incident occurred between 2011 to 2018. The sus-
Krishi Seva soci- pects prepared fake rubber stamps and documents of
eties in the Late Vasantrao Naik Vimukta Jatis and Nomadic Tribes
Cooperative Spinning Mill in Solapur and later opened an account with the bank.
state, most of
which lie defunct Later, a loan of Rs 24.40 crore was sanctioned to the mill,” an officer attached
with Shivajinagar police station said.
due to non-recovery of agricultural
loans, said GSCB chairman Ulhas “The incident came to light during the bank’s audit carried out by the govern-
Phaldessai. ment auditors where it was found that the money was siphoned on the name
Apart from deputing a bank em- of granting loan to the spinning mill. It was found that all the officials of the
ployee to streamline the functioning bank, including the chairman, existing directors, past directors, manager, clerk
of the VKS societies, “GSCB also plans and tax consultant, knew about the transactions and are suspected to be in-
to obtain refinance from NABARD volved in it,” he added.
and pump it into the societies” for The officer said that they have not arrested anyone yet and will initiate action
priority sector lending, he stated. as per the law. “We have got the addresses of some of the suspects including
Phaldessai said the societies have existing directors but are yet to get the addresses of the past directors of the
been mismanaged and money dis- bank that have been booked in the case. We are gathering information about
bursed by GSCB as loans has not them and will soon reach out to them,” he said.
been recovered.
The suspects have been booked under sections 465 (punishment for forgery),
“With just 10 to 15 of them working 467 (punishment for forgery), 468 (forgery for purpose of cheating), 471 (using
properly, most VKS societies are in a as genuine a forged document or electronic record) and section 477 (A) (falsifi-
bad condition. The finance that was cation of accounts) of the Indian Penal Code.
given to them is stuck because no re-
covery of loans is happening,” the Maharashtra State Co-op banks turns away 55 sugar
chairman said. He said the bank has
requested the government to give it mills in state
powers to recover loans from de- The Maharashtra State Cooperative Bank (MSC) has turned away around 55
faulters since the Securitisation and sugar mills in Maharashtra, for which they may find it difficult to commence
Reconstruction of Financial Assets crushing in 2019-20 sugar season. Tthe MSC Bank is reported to have stated
and Enforcement of Securities Inter- that the sectoral exposure limit of the bank to the sugar sector had been ex-
est Act, 2002 (the SARFAESI Act) is a hausted and the bank was not in a position to issue pre-season loans to mills.
long-drawn process. Gaikwad noted that MSC Bank officials had raised concerns over extending loans
Meanwhile, Curtorim MLA Aleixo as their exposure limit to the sugar sector had already exhausted. These 55 mills
Reginaldo Lourenco has demanded can approach other public sector banks for loans, he said, while adding that
that NABARD audit the bank’s Nabard has also stated that these mills cannot be funded unless a government
financials. “The chairman and board guarantee is given.
of directors must act on issues of mis- Several issues raised by sugar mill owners include seeking an increase in the
management, misappropriation. The sectoral exposure of Nabard to this sector, restructuring of loans, government
state’s apex cooperative bank cannot guarantee for mills with negative net worth or negative NDRs, revised guide-
be allowed to collapse,” Lourenco lines by Nabard for the season and NoCs for loans from the government for those
said.
factories that have been set up on government land.

BANKING FINANCE | DECEMBER | 2019 | 21