PMC bank scam: Director, two others arrested

The Economic Offences Wing of Mumbai Police arrested the director of one of the leading valuing firm Yardi Prabhu Consultants and valuers Vishwanathan Prabhu and one of his employees Shripad Jere were arrested in Punjab and Maharashtra Cooperative Bank fraud case for allegedly overvaluing the properties of PMC Bank to manipulate the balance sheet mortgage properties of borrowers including HDIL group in order to increase the capital adequacy of the bank for showing healthy balance sheet to Reserve Bank of India RBIAlong with this valuers the investigating agency also arrested another former PMC bank director Jasvinder Singh Banwait who was also a member of loan investment and executive committee of the bankAccording to EOW both the accused were impanelled valuers of PMC bank These valuers over evaluated many properties of HDIL which were kept as a mortgage with the bank HDILs Saphire group got a Rs 10 crore loan from PMC HDIL kept the property as a mortgage which was initially evaluated to be Rs 35 crore by these accused valuers Later as the propertys value was not sufficient for a Rs 10 crore loan so the valuers overevaluated the property from Rs 35 crore to Rs 7 crore and by the time the loan had been granted The agency has also found in their investigation that they overvalued a flat of one of the former directors of the PMC bank who then got a loan against this overvalued flatThe agency has revealed before the court that they gave an overvalued Captial Adequacy Ratio CAR report of the bank to RBIRBI tracks the CAR of a bank to ensure that the bank can absorb a reasonable amount of lossWe suspect that because these overvalued CAR of the bank RBI couldnt judge the loss the bank was facing and the risk which was involved an officer saidThese valuers were called by investigation officer during the early stage of the investigation but there was no evidence found against them The accused also claimed that they never met Joy Thomas while the PMC bank employees told the officer that these valuers used to visit the bank frequently to meet Joy Thomas My team has conducted a thorough inquiry before arresting these valuers of the bank confirming their arrest said Rajvardhan joint commissioner EOWEOW believes that these accused valuers connived with Joy Thomas Former MD of PMC and Waryam Singh former director PMC and overvalued banks properties and furnished reports as per the Joy Thomas and Waryam Singh had desiredDuring interrogation it was revealed that in 2012 PMC bank had to revalue its properties The bank is required to have a Capital Adequacy Ratio CAR of at least 12 per cent but PMCs CAR was only 1099 per cent in 2012 So these accused valuers overvalued banks properties to show a healthy balance sheetAgain in 2015 when the bank was facing low CAR 1075 per cent accused again overvalued banks properties to manipulate the balance sheet and show a CAR of 12 per cent The accused did this after a meeting with Joy Thomas at PMCs Bhandup office The accused showed a CAR of 1243 per cent of the bankIn June 2018 a relative of a former director of PMC applied for a Rs 130 crore loan This loan was granted against a flat located in Mumbais Kurla area The actual worth of the flat was Rs 6902 lakh but the accused valuers showed it to be Rs 134 cr But as per the guidelines the loan can be only 80 of the mortgaged properties value so the valuers once again overvalued the flat and showed it to of Rs 162 cr and the loan was grantedThe accused have been produced before the court and has been remanded to police custody till 16th of March further investigations are underway Shrikant Paropkari DCP EOWSo far the agency have arrested 15 accused in the ongoing investigation of PMC bank fraud case and has filed two charge sheet against 12 accused the agency likely to file final charge sheet in the matter by end of MarchCatch up on all the latest Crime National International and Hatke news here Also download the new midday Android and iOS apps to get latest updates