The Oriental Bank of Commerce (OBC) detected the Rs 389 crore fraud by Dwarka Das jeweller in June 2014, but took three years to report the matter to the CBI. According to sources, the CBI also took its own time to file the FIR, sitting over such a sensitive complaint for more than six months.
In a filing to stock exchanges on Monday, the OBC said the account of Dwarka Das jeweller turned non-performing asset (NPA) or bad loan on March 31, 2014, and the bank declared the company a wilful defaulter on June 30, 2014.
“Further, as per extant procedures, the bank reported these accounts as fraud to CBI and RBI. The case has now been registered as per procedures,” the OBC said, adding,” “Total exposure in these account have been fully provided for and there will be no additional impact on the profitability on the bank.”
As per filing to the stock exchanges, the OBC did report the fraud to the CBI, but only three years later in September 2017. The CBI also showed the same indifference to the case, waking up only last week when the reverberation of PNB fraud jolted the banking sector.
The OBC similarly delayed reporting the Rs 200 crore Smbholi Sugar Mills fraud to the regulator and probe agencies.
The fraud took place between 2015 and 2016, but the matter came to light only on Sunday when the CBI booked top officials of the sugar mill.
Talking about the Dwarka Das jeweler fraud, the State-owned bank said the alleged fraud of Rs 389.85 crore will not impact its profitability as the lender has made full provisions for the defaulted amount in its books.
“Total exposure in these account have been fully provided for and there will be no additional impact on the profitability on the bank,” it added. The CBI has registered a case against Dwarka Das Seth International, diamond jewellery exporter, for an alleged bank loan fraud of Rs 389.85 crore towards OBC.