PMC Bank scam: Ex-director's police remand extended

A Mumbai court has extended the police remand of PMC Bank's former director till October 24. Surjit Singh Arora was produced before the Metropolitan Magistrate on Tuesday in connection with the alleged Rs 4,355 crore scam.

Mumbai: A Mumbai court has extended the police remand of Punjab and Maharashtra Cooperative (PMC) Bank's former director Surjit Singh Arora till October 24 on Tuesday. He was arrested last week by Mumbai Police's Economic Offences Wing (EOW) in connection with the alleged Rs 4,355 crore scam.

He was produced before the metropolitan magistrate SG Shaikh after his police remand ended on Tuesday. Arora is the fifth accused to be arrested in the case.

Besides Arora, the EOW has arrested the bank's former managing director Joy Thomas, its former chairman Waryam Singh, Housing Development Infrastructure Ltd's (HDIL) chairman and Managing Director Rakesh Wadhawan and his son Sarang Wadhawan in connection with the scam.

The EOW last week said that Arora was the director and key member of the loan committee of the bank until its affairs were taken over by the RBI.

The HDIL group of companies were awarded credit facilities on a large scale, wherein the fraud occurred. The alleged fraud was said to be 'sheltered' by Arora.

The EOW also told the court that bank officials replaced 44 loan accounts of HDIL with 21,049 fictitious accounts to camouflage huge loan defaults by the real estate group which landed the bank in the current crisis.

"Arora, in collusion with other accused, performed his alleged role in the crime," the probing agency said.

"Arora was elected on the directors' body to ensure the proper functioning of the bank. However, he abused his official position to facilitate the fraud," it said.

The EOW earlier this month registered a case against the Wadhawans and top officials of the PMC Bank for allegedly causing losses to the tune of Rs 4,355.43 crore to the bank.

After the scam was unearthed in the bank, which has deposits of over Rs 11,000 crore, the Reserve Bank of India appointed an administrator over it, and capped its withdrawals at Rs 40,000 per account for six months.