Repco Home Finance: CBI files cheating cases against MD, ED
The Central Bureau of Investigation (CBI) has registered a case of conspiracy, cheating and corruption against Managing Director (MD), Executive Director, Chief Manager and Deputy General Manager (DGM) of Repco Home Finance. R Varadarajan, the MD of Repco Home Finance was former MD of Repco Bank.
Earlier, the CBI carried out raids on residences and offices of top executives of Repco Home Finance Ltd. In a release, the agency said it filed a case of corruption, cheating and conspiracy against the managing director and two other senior officials of the home finance company.
In a regulatory filing, Repco Home Finance, says, “As per press reports the company has come to know that, the CBI conducted searches at the residence of R Varadarajan, Managing Director, V Ragu, Executive Director and KS Kannan, the then Chief Manager of the company with regard to waiver of pre-closure charges on 8 October 2016."
There is no material impact on the company, Repco Home Finance added.
Repco Home Finance shares ended Monday 5.6% down at Rs777.80 on the BSE, while the 30-share benchmark Sensex closed marginally higher at 28,082 points.
Besides these three top executives, the CBI also registered cases against, Sekar, who is deputy general manager of Repco Bank and Shanthamani alias Shanthi, and Thirumalaisamy alias Thambu, both partners of a Coimbatore based entity that deals in textile machinery spare parts and real estate.
CBI said it conducted searches at various places at Chennai and Coimbatore and seized incriminating documents and the investigation is in progress.
According to CBI, during 2005 and 2008, the firm belonging to Shanthi and Thambu obtained a loan of Rs3.70 crore from Repco Bank, which became a non-performing asset (NPA) and was closed during 2010. While closing the loan, Varadarajan and others favoured Shanthi and Thambu's partnership firm by waiving off penalty of Rs24.31 lakh.
Again in 2013, these officials waived of pre-closure charges of Rs22.64 lakh for another loan account of Shanthi and Thambu, leading to losses to the Bank, the CBI said.
Repco Bank (Repatriates Cooperative and Finance and Development Bank) is a cooperative bank established by the Indian Government in 1969 to improve financial needs of repatriates from Sri Lanka and Burma. Indian government owns 52.65% stake in Repco Bank, while four states, Tamil Nadu (4.92%), Andhra Pradesh (1.24%), Kerala (0.42%), Karnataka (0.12) and repatriates hold 40.65% shares in the Bank as on 31 March 2016.
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