PMC bank scam: Ex-MD sent to police custody till Oct 17, lawyer says being made scapegoat

Saturday, 5 October 2019

The bank's board of directors and executives, including Thomas, had "full knowledge" of this act, police said.

MUMBAI: Former managing director of Punjab and Maharashtra Cooperative (PMC) Bank, Joy Thomas, arrested in connection with the alleged Rs 4,355 crore scam at the bank, was on Saturday remanded in police custody till October 17.

His lawyer Rakesh Singh argued that Thomas was just an employee of the bank and not a decision-maker and was being made a scapegoat as the loans turned out to be bad.

The Economic Offences Wing (EOW) of Mumbai Police, which had arrested Thomas on Friday, produced him before Additional Chief Metropolitan Magistrate S G Shaikh.

The police told the court that they needed his custody to interrogate him as he was part of the conspiracy, adding that the bank provided various credit facilities to the bankrupt Housing Development and Infrastructure (HDIL) group firms, most of it guided or committed by the accused.

It appears the funds availed by HDIL from the bank have not been used for the designated purpose, police told court.

Thomas deliberately didn't disclose it for about three years, which concludes to be a deliberate act of benefit, the police said.

The EOW stated that PMC replaced 44 loan accounts of HDIL and its group companies, whose outstanding balance was significantly higher, with 21,049 fictitious loan accounts.

The bank's board of directors and executives, including Thomas, had "full knowledge" of this act, police said.

Singh argued that the allegation of giving 21,000 loans was wrong as there was not even a "whisper" of it in the FIR.

"The loans given to HDIL group were secured. In fact, the security against the loan is more than 2.5 times of the credit facility extended to them. If the loans were fully secure, then how am I wrong," he argued.

No case is made against Thomas and, at most, he can be blamed for not informing RBI in the manner it should have been done, he said.

On Thursday, the EOW had arrested HDIL directors Rakesh Wadhawan and his son Sarang in connection with the case. They are in police custody till October 9.

The EOW had registered an FIR on Monday against senior officials of HDIL and PMC Bank for allegedly causing losses to the tune of Rs 4,355.43 crore to the bank.

The FIR named former PMC Bank chairman Waryam Singh, Thomas and other senior officials, besides the Wadhawan duo.

The Enforcement Directorate had conducted raids at six locations in and around Mumbai on Friday after taking cognisance of the FIR registered by the EOW.

According to police, the HDIL promoters allegedly colluded with the bank management to take loans from its Bhandup branch in Mumbai.

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