The Central Bureau of Investigation (CBI) has filed a case against ABG Shipyard Ltd. The investigation agency has booked its directors/promoters Rishi Kamlesh Agarwal, Santhanam Muthaswamy, Ashwani Kumar, Sushil Kumar Agarwal and Ravi Vimal Nevetia.
They are booked for duping a 28-member bank consortium of ₹ 22,842 crores. The bank fraud is much bigger than the PNB scam which involves Nirav Modi and Mehul Choksi.
CBI is also going to probe the alleged involvement of public servants in this massive fraud. According to law, a bank’s top officials including chairman, directors, auditors, managers, and employees are deemed to be public servants.
ABG Shipyard owes ₹7,089 crores to ICICI Bank, ₹3,639 crores to IDBI Bank, ₹2,925 crores to State Bank of India, ₹1,614 crores to Bank of Baroda, ₹1327 crores to Exim Bank, ₹1,244 crores to Punjab National Bank, ₹ 1228 crores to Indian Overseas Bank, ₹ 743 crores to Standard Chartered Bank, ₹719 crores to Bank of India, among others.
Forensic Audit (during 2012-2017) by consultancy Ernst and Young (EY) revealed that all the accused colluded together and indulged in illegal activities like diversion of funds, misappropriation and criminal breach of trust.
They allegedly took loans from 28 different banks. The money was used to buy properties and was also sent abroad. The loan amount was declared as non-performing asset (NPA) in July 2016 and fraud in 2019.
SBI had filed the first complaint on November 8, 2019. CBI had sought some clarifications on March 12, 2020 in connection to that complaint.
State Bank of India filed a fresh complaint in 2020. For over one and a half years, CBI scrutinized the complaint and took action on February 7.
ABG Shipyards is one of India’s largest firms engaged in shipbuilding and ship repair. It is located in Dahej and Surat in Gujarat.
When asked to comment, Union Finance Minister Nirmala Sitharaman stated that ABG Shipyard’s account turned NPA during UPA regime.
She added, “in this particular case with that kind of a measurement, actually, I should say to the credit to the banks, they’ve taken lesser than what is normally an average time to detect these kinds of frauds.”