BJP-led cooperative bank of Mumbai, Pravin Darekar, warned of losses and sugar mill loans
The Bharatiya Janata Party (BJP) lawmaker, led by Pravin Darekar, Mumbai District Central Cooperative Bank Limited, has been notified by the State Cooperation Department for alleged discrepancies on six counts, including losses at during the last fiscal year, the reduction of capital receipts, the recovery of loans to sugar factories and corporate companies and loans to housing cooperatives for their self-redevelopment.
In a letter dated September 18, Cooperation Commissioner and Registrar Anil Kawade formed a team of three officials in Mumbai to investigate alleged irregularities at the bank, one of the state’s leading cooperative district financial institutions. The team led by Joint Divisional Registrar Bajirao Shinde was asked to verify the losses of ₹47.99 crore and capital adequacy ratio (RCA) at 7.11% in fiscal year 2019-20. The team was also tasked with reviewing and recovering sugar refinery and corporate loans, the bank’s office modernization expenses, including its core banking solutions over the past five years, and loans to housing co-ops in the redevelopment plan.
Darekar, opposition leader in the Legislative Council, however, said the opinion was not an investigation but an inspection of the books of account, and the action was politically motivated. The cooperation department team was asked to submit their report within one month. “It is true that we have suffered losses of ₹47 crore in the last fiscal year, but they were incorporated in the second quarter which ended September 30. Likewise, CRAR has been increased to 10% now. They talked about computerization, which has never been done in the past five years. Our sugar refinery and business loan recovery is up to par and the loans have helped us earn ₹125 crore. They said that no authorization from the Reserve Bank of India (RBI) had been taken for the self-redevelopment program. We recently met with RBI officials and they praised our initiative, ”he said, adding that the case review team would receive all documents.
The bank has been embroiled in controversy over irregularities in its books over the past few years. The bank, led by Darekar as chairman, has faced various accusations of improprieties, including disbursing loans from ₹2.35 crore to relatives of the president using false documents. The National Bank for Agriculture and Rural Development (NABARD), the regulatory authority, instructed the State Cooperation Service in March 2018 to file a first information report (FIR) on the embezzlement. by two of the bank’s branches in Borivli. In March 2015, the Economic Crimes Wing of the Mumbai Police Department registered an FIR against Darekar and three other bearer officers for embezzlement and embezzlement in the amount of ₹128 crore. They were accused of abusing the overdraft facility, dubious transactions on behalf of around 60 working credit companies formed in a single day, and irregularities ₹5.9 crore by awarding a contract to set up a disaster recovery system – a backup for IT operations.
Political pressure has prevented any solid action from being taken in the past, according to an official in the cooperation department. “The bank has also faced allegations of irregularities and embezzlement in the past, but no action has yet been taken. No FIR was filed despite NABARD directives to the government for fraudulent transactions. The EOW completed its investigation in ₹A scam of 128 crore, but no charge sheet was filed due to political pressure from the state government then led by the BJP. Action in this and even in other cases is unlikely, even after the change of power in the state. The arrests of the accused under Article 88 and the action to seize the property of the administrators under Article 98 of the Cooperation Law were possible if the investigation had been carried out to the logical end. The new investigation ordered by the cooperation commissioner is a routine process and could prove painful if taken seriously, ”said a department official.
Darekar, who was an MP for Maharashtra Navnirman Sena (MNS) from 2009 to 2014, joined the BJP following its defeat in the 2014 assembly elections. The BJP sent him to the Legislative Council in June 2016 and he was elected Leader of the Opposition in the Upper House last year.
Darekar said the advice sent was out of his political ego and claimed the government was trying to suppress his voice. “The bank sent a notice to the cooperation service for the recovery of ₹250 crore against the guarantee given by the government for the loans to the sugar factories. We demanded not to give new guarantees to sugar factories until the old guarantee to banks like us was settled. The advice of the cooperation service is due to our notice of collateral recovery in respect of them. The government wants to suppress my voice, ”he said.
The lawmaker added that the Bombay High Court had given him a clear note in all other pending cases against him.