CBI Court sentences four in Rs 2.42 Cr bank fraud case

Madurai – Tamil Nadu: The CBI Special Court in Madurai has sentenced four individuals, including a former bank manager of Indian Overseas Bank, Palayamkottai Branch, Tamil Nadu, to 3-4 years’ rigorous imprisonment and imposed a total fine of Rs 3.4 lakh in a Rs 2.42 (2,42,37,431/-) crore bank fraud case, according to a press release by the CBI.

Rigorous imprisonment and fines

On Friday, the CBI Special Court in Madurai convicted and sentenced four accused for their involvement in a bank fraud case. The sentences and fines imposed are:

G Bala Subramanian, then Chief Branch Manager, Indian Overseas Bank, Palayamkottai branch: 3 years’ rigorous imprisonment (RI) with a fine of Rs 80,000.

N Kalyanasundaram, a private individual: 4 years’ RI with a fine of Rs 1.4 lakh.
N Mahalingam, a private individual: 3 years’ RI with a fine of Rs 60,000.
M Ammamuthu, a private individual: 3 years’ RI with a fine of Rs 60,000.

The Case: Conspiracy and fraudulent loans

The Central Bureau of Investigation (CBI) registered the case on September 24, 2010, alleging that between 2007 and 2010, the accused conspired to defraud the Indian Overseas Bank’s Palayamkottai branch in Tirunelveli.

Key allegations:

The accused sanctioned loans, including open cash credit, term loans, and vehicle loans, in wilful violation of bank norms.

Loans were approved without proper credit analysis, causing a wrongful loss of Rs 2.42 crore to the bank.

Investigation and chargesheet

Chargesheet filing After completing its investigation, the CBI filed a chargesheet against the accused on August 30, 2011.

Trial: Following a detailed trial, the court found all accused guilty and sentenced them accordingly.

Court’s judgment

The court’s verdict serves as a stern warning against financial misconduct in banking institutions. The judgment also underscores the importance of adherence to regulatory norms to safeguard public sector banks from fraudulent practices.