Bank Director Suspended over Loan Fraud Case

In a shocking development, the Joint Registrar of Cooperative Societies, Jalandhar Division, has removed Arinderbir Singh Walia, Director of the Hall Bazaar Cooperative Bank, from his position with immediate effect. The action comes after an internal inquiry revealed that Walia was involved in taking a fraudulent house building loan using fake documents.

Fake Loan on a Non-Existent Plot

According to official records, Arinderbir Singh Walia and his father, Satwinder Pal Singh Walia — who had earlier worked at the same bank — had availed a ₹10 lakh house building loan. The loan was released in three installments starting on October 16, 2017.

However, during the investigation, it was discovered that the loan was taken against a non-existent plot using forged property documents. Despite this fraudulent act, Walia continued to climb the ranks within the bank and eventually became the Chairman of the Cooperative Bank on December 15, 2021 — while the fraudulent loan case was still unresolved.

Loan Repayment Doesn’t Erase the Crime

Although the loan was completely repaid in 2025, the inquiry officers clarified that repaying the amount does not absolve the offence. The loan account was officially closed on March 6, but investigators maintained that the loan had been obtained on false documents, which constitutes a serious violation of banking and cooperative regulations.

Negligence by Bank Staff

After the fraud came to light, a show-cause notice was issued to Walia, giving him 15 days to submit an explanation. In his written reply, Walia denied wrongdoing, but the inquiry report pointed out that some bank employees were also at fault. They showed serious negligence during the verification process, preparing false reports that allowed the fake loan to be approved.

Administrative Action Taken

Based on the findings, the Joint Registrar ordered Walia’s immediate removal from his post as Director. The department has also initiated steps to fix responsibility on the bank staff who failed to properly verify the loan documents. This incident has once again raised serious questions about internal monitoring and verification systems in cooperative banks, especially when senior officials themselves are found involved in such fraudulent practices.