PMC Bank crisis: Two HDIL Directors arrested
What's the story
Amid the Punjab Maharashtra Co-operative (PMC) Bank crisis, the Economic Offense Wing of the Mumbai Police arrested two directors of the real estate firm Housing Development and Infrastructure Limited, or HDIL, on Thursday.
Reportedly, HDIL Executive Chairman Rakesh Kumar Wadhawan and Managing Director Sarang Wadhawan were arrested in connection with alleged financial irregularities at the firm.
Here are more details.
Details
PMC extended Rs. 6,500cr loans to bankrupt HDIL
According to Business Today, the two directors were arrested based on an FIR filed with the Mumbai Police.
HDIL is also involved in the PMC Bank case, wherein the bank's now-suspended Managing Director Joy Thomas extended loans to the bankrupt HDIL amounting to Rs. 6,500 crore- four times its regulatory cap and 73% of its total assets (Rs. 8,880 crore).
Complaint
Complaint also named Thomas, PMC Chairman Waryam Singh
The complaint was filed by RBI administrator Jasbir Singh Mattha who alleged that starting 2008 till August 2019, the loans given to a particular company remained unpaid and had instead turned into NPA (non-performing asset).
It also names bank officials, including Thomas and the PMC Chairman Waryam Singh accusing them of criminal breach of trust, forgery, and falsification of records.
Information
Mumbai Police constituted SIT to probe case
Meanwhile, the Mumbai Police have formed a special investigation team (SIT) to probe the case. Authorities have also attached property to the tune of Rs. 3,500 crore in the PMC Bank case, according to The Economic Times.
History
Previously, government had issued lookout notice against the two directors
Earlier today, both directors were called for questioning by the EOW, but they allegedly didn't cooperate.
The government had previously issued a lookout notice against both directors and asked immigration officials to ensure that they wouldn't leave the country, India Today reported.
On September 23, RBI officials placed PMC Bank under directions for six months due to irregularities pertaining to the extension of loans.