Biggest bank fraud: ABG Shipyard dupes 28 banks of ₹22842 crores !

The biggest bank loan scam in India surpassing fugitives Nirav Modi and Vijay Mallya’s fraud has happened as Gujarat based ABG Shipyard has been accused of defrauding a consortium of 28 banks LED State Bank of India.
The Central Bureau of Investigation has already taken up the case and has booked company’s former Chairman and Managing director Rishi Kamesh Agarwal.
Moreover, CBI has also slapped charges on the then executive director Santhanam Muthaswamy, directors Ashwini Kumar, Sushil Kumar Agarwal and Ravi Vimal Nevetia and another company ABG International Pvt Ltd for alleged cheating, criminal conspiracy, criminal breach of trust and abuse of official position under the IPC and the Prevention of Corruption Act.
State Bank of India, where accounts of ABG Shipyard was maintained, was the first among 28 banks to file forensic audit in report to the CBI. According to forensic audit report the company owed 70.89 billion rupees to ICICI Bank, 36.34 billion rupees to IDBI Bank, 29.25 billion rupees to the State Bank of India, 16.14 billion rupees to Bank of Baroda, 12.44 bilion rupees to Punjab National Bank and 12.28 billion rupees to Indian Overseas Bank.
That report, included in the CBI complaint posted on Sunday, said the fraud took the form of diversion of funds, “misappropriation and criminal breach of trust with an objective to gain unlawfully at the cost of the Bank’s funds”.
“The money was used for purposes other than the purpose for which the funds were released by the Bank”, it said.
“Searches were conducted on Saturday at 13 locations in the premises of accused including private company, directors at Surat, Bharuch, Mumbai, Pune etc which led to recovery of incriminating documents,” CBI said in a statement.
The ABSGL being a key player in Indian shipbuilding industry operates at Shipyards in Gujarat with capacity to build vessels 18,000 deadweight tonnage (DWT) at Surat Shipyard and 1,20,000 deadweight tonnage (DWT) at Dahej Shipyard.
“Global crisis has impacted the shipping industry due to fall in commodity demand and prices and subsequent fall in cargo demand. The cancellation of contracts for a few ships and vessels resulted in piling up inventory. This has resulted in a paucity of working capital and caused a significant increase in the operating cycle. thereby aggravating the liquidity problem and financial problem,” the complaint said.
The SBI said there was no demand of commercial vessels as the industry was going down slide even in 2015 which  further went worse due to lack of defence orders making it stiffly tough for the company to maintain repayment schedule.

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