The ED, in a statement on Thursday, said, “To hide the siphoning, the available funds were routed to these fictitious accounts and from these accounts to the several bank accounts of entities founded/controlled by Patil.”
The Enforcement Directorate (ED) has filed a prosecution complaint (chargesheet) against former Panvel MLA Vivekanand Shankar Patil and Karnala Nagari Sahakari Bank Limited alleging that between 2008 and 2018, Patil, the former chairman of the bank, siphoned Rs 560 crore from the bank through 63 fictitious accounts to the loan accounts of Karnala Charitable Trust and Karnala Sports Academy, which were founded and controlled by him.
The ED, in a statement on Thursday, said, “To hide the siphoning, the available funds were routed to these fictitious accounts and from these accounts to the several bank accounts of entities founded/controlled by Patil.”
The ED complaint has alleged that the siphoned money was utilised by Karnala Charitable Trust and Karnala Sports Academy for construction of properties such as a sports complex, college, schools and for other personal gains. The ED said the money used for such constructions was projected “as un-tainted in contravention of offence of money laundering”.
In June, the agency had arrested Patil, a member of the Peasants and Workers Party of India.
The money laundering case of ED against Patil is based on an FIR registered by the Economic Offences Wing (EOW) of Navi Mumbai police last year. The police booked 76 persons, including Patil, for cheating, forgery and criminal breach of trust, in connection with the bank fraud detected by the Reserve Bank of India (RBI).
An RBI audit on the 17 branches of the bank found that several loan accounts were opened without due diligence and the money loaned to these customers was misappropriated.
In June 2020, the RBI had restricted withdrawals at Rs 500 per depositor across all accounts of Karnala Nagari Sahakari Bank.
RBI had also said the bank cannot grant loans and advances, make any investment and incur any liability, including acceptance of fresh deposits without its approval. The bank was also prohibited from disbursing any payment, or entering into any arrangement to sell, transfer or dispose of any of its properties or assets.
According to the last published financial results of the bank, as on March 31, 2017, it had deposits of Rs 476.3 crore and advances of Rs 454 crore. The bank has 7,288 members and about 40,000 depositors.
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