Bank Fraud: The Directorate of Enforcement (ED) conducted raids across four locations in Bhopal as part of an investigation into an alleged bank fraud involving M/s Excel Vehicle Pvt. Ltd. The raids, conducted under the Prevention of Money Laundering Act (PMLA), 2002, targeted the company, its directors, and associates over accusations of fund diversion leading to a ₹44 crore loss for the Bank of India.
Bank Fraud Details: What happened in Bank of India and Kotak Mahindra Bank
The ED’s investigation was triggered by an FIR filed by the Central Bureau of Investigation (CBI) under multiple sections of the Indian Penal Code (IPC), 1860, and the Prevention of Corruption Act, 1988. M/s Excel Vehicle Pvt. Ltd. reportedly secured a ₹42 crore credit facility from the Bank of India in 2014, but the loan was declared a non-performing asset (NPA) by 2017. In 2019, Kotak Mahindra Bank notified the Bank of India of prior mortgages on certain properties by the company’s sister concern, M/s My Car (Bhopal). These properties, previously mortgaged to Kotak Mahindra Bank to secure additional loans, had also been pledged to the Bank of India. This revelation led the Bank of India to label the account as fraudulent, subsequently reporting it to the Reserve Bank of India (RBI).
The ED’s preliminary findings suggest that M/s Excel Vehicle Pvt. Ltd. had diverted significant funds to its sister companies, using them to pay vendors and settle debts owed to other financial institutions, including NBFCs. During the raids, authorities seized several incriminating documents, a mobile phone, diamond and gold jewelry valued at approximately ₹85 lakh, and cash totaling around ₹25 lakh.
The investigation remains ongoing as the ED probes deeper into the financial transactions associated with M/s Excel Vehicle Pvt. Ltd.
