Mumbai Co-op bank scam: Former manager held for siphoning Rs 122 crore

AMID growing panic over the suspension of all transactions at New India Cooperative Bank Mumbai Policersquos Economic Offences Wing EOW arrested the former general manager Hitesh Mehta for allegedly siphoning Rs 122 crore from the bankrsquos treasury ldquoOn Saturday Mehta was brought to the EOW office for further questioning His Dahisar house was also raided He was then arrestedrdquo confirmed EOW DCP Mangesh ShindeThe fraud was exposed during a routine inspection by the RBI at the bankrsquos corporate office in Prabhadevi on February 12 Central bank officials conducted a cash audit of the vault located on the third floor where the bankrsquos funds were stored Simultaneously another team inspected the bankrsquos Goregaon branchThe accused Hitesh Mehta hides his face left as the EOW escort him out for a medical test PicSatej ShindeRBI officials discovered a staggering shortfall of Rs 112 crore at the Prabhadevi office This number rose to Rs 122 crore when the Goregaon branchrsquos cash records were reviewed When questioned about the missing funds senior bank officials claimed they had no knowledge of the discrepancy The RBI then demanded an immediate explanation and a detailed reportMehtarsquos ConfessionLater that evening Mehtamdashwho was also head accountant and oversaw cash management at the bankmdasharrived at the Prabhadevi office and was questioned by RBI officials In the presence of senior bank executives he confessed to the fraud admitting that he had been withdrawing cash since the COVID19 pandemic and had given the money to his acquaintances His confession was recorded on a mobile phone by an RBI official and he later provided a written statement confirming his actionsOn the same day a formal complaint was lodged at the Dadar police station by Devarshi Ghosh Acting Chief Accounting Officer at the bank The next day on Thursday an FIR was registered by the EOW under BNS sections 3165 criminal breach of trust and 612 criminal conspiracyAuthorities are now probing the extent of the fraud tracing the misappropriated funds and identifying if any additional individuals were involved in the scam ldquoThis is not fraud but a case of allegations of misappropriation of funds as stated in the FIR The real question is if the misappropriation had been happening since COVID19 what was the bank doing How can someone take R122 crore without the bankrsquos knowledge My client is innocent and is being unfairly targeted We will contest this in courtrdquo said Advocate Chandrakant Ambani CA Legal representing the accused MehtaCanrsquot believe it say Mehtarsquos neighboursHitesh Mehta was picked up by the EOW from his 14thfloor apartment at NL Aryavarta Dahisar East around 130 pm The EOW did not seize anything from his house during the raid A member of the residential society told midday ldquoThe Mehta family has lived in this society for many years we are shocked that he could be involved in such a scam His wife is aged and has health issuesrdquo Another resident said ldquoWe have never heard any negative things about the Mehta family before this They live very simply like any middleclass family If Mehta is involved in this scam he should be punishedrdquoApart from citizens residential societies that parked their funds with the bank have also been left in the lurch because of the embezzlement and subsequent freeze on transactions The Mulundbased Devashish Society has had an account at the cooperative bank for the last 30 years Society committee chairman CM Deshmukh said ldquoAll our transactions to cover the societyrsquos expenses are now stuck including salaries for the staff We are unable to access the savings account which holds about R5 lakh Luckily we shifted the societyrsquos FD to another bank a year ago We wonrsquot trust any cooperative banks after thisrdquo