Housing Development Infrastructure Limited’s (HDIL) directors Rakesh Wadhawan and Sarang Wadhawan have been arrested by the Economic Offences Wing (EOW), Mumbai in the Punjab and Maharashtra Co-operative Bank Case, said the sources in the agency. The EOW has also provisionally attached properties worth Rs 3500 crore which includes land parcels and commercial premises of HDIL.
The Wadhawans were unable to give satisfactory replies following which they were placed under arrest, stated sources. According to the agency, a total of 44 accounts linked with HDIL were masked by tampering bank software, which left them virtually hidden from the core banking system. Only a chosen few employees of PMC were in know of these bank accounts, revealed EOW sources.
The Mumbai Police had filed a case against the bank officials and HDIL promoters in the Punjab and Maharashtra Cooperative (PMC) Bank case on Monday.
PMC bank’s former Managing Director Joy Thomas had revealed that the bank’s exposer to real estate developer company HDIL stood 10.2 billion rupees ($144 million) by 2011 and this was hidden from the RBI..
Punjab & Maharashtra Co-operative Bank Ltd. was able to dupe regulators about its growing exposure to a single property developer for at least a decade before the firm filed for insolvency, according to Thomas.
The bank used “dummy accounts” and other methods to hide its oversized loans said Bloomberg News.
HDIL, a slum redevelopment company which has now gone bankrupt has been delaying loan payments for the past few years.