Home Loan Fraud in SBI: CBI Registers Case Against 6 People for Rs.5 Crore Home Loan Fraud in SBI Chennai

Chennai: The Economic Offences Branch (EOB) of the CBI has registered a case against six individuals for allegedly defrauding State Bank of India (SBI) by obtaining a home loan of ₹5 crore using forged documents. The investigation was initiated following a directive from the Madras High Court, after SBI’s Home Loan Centre flagged irregularities in the loan process.

Fraudulent Home Loan Obtained Using Fake Documents

As per the FIR filed earlier this month, the CBI has named the accused as S Vakisan and Deivanai from Puducherry, D Santosh from Madipakkam, Vummidi Kritish from Tiruporur on East Coast Road (ECR), and valuers M Vijaykumar from Puducherry and S Senthil from Chennai. Additionally, the investigation also includes unknown public servants suspected of being involved in the fraud.

According to SBI’s complaint, Vakisan and Deivanai applied for a ₹5 crore home loan in 2020 to purchase a luxury villa on ECR, constructed by Santosh Builders, owned by D Santosh. The valuation of the property was conducted by M Vijaykumar and S Senthil, who assessed the property’s worth at ₹6 crore. Based on this valuation, SBI sanctioned the loan, and the funds were transferred to the builder and the landowner, Vummidi Kritish.

Loan Repayment Stopped After Initial EMIs

The borrowers paid EMIs until April 2021, but later requested a loan restructuring due to the financial impact of COVID-19. The bank approved the restructuring, extending the repayment period until July 2023. However, an internal audit raised suspicions about the authenticity of the loan and triggered a deeper investigation.

Irregularities Exposed During SBI’s Internal Audit

The audit revealed that the loan was sanctioned for construction and purchase, whereas the villa had already been built in 2016. Further discrepancies included:

• The approval plan for construction dated back to 2011
• The land was regularized in 2019, meaning it was already in use before the loan was taken
• The property’s actual valuation was only ₹4 crore, significantly lower than the ₹6 crore reported by the valuers

Due to these findings, SBI classified the loan account as fraudulent and declared it a Non-Performing Asset (NPA) with an outstanding balance of ₹5.56 crore.

CBI Files Charges Under IPC and Prevention of Corruption Act

Following the bank’s complaint, CBI alleged that the accused used fake documents, forged approvals, and inflated property valuations to fraudulently obtain the loan. The agency has registered a case under several sections of the Indian Penal Code (IPC) for cheating, forgery, and criminal conspiracy, as well as under the Prevention of Corruption Act.

CBI Investigation Underway

With the case now under CBI’s Economic Offences Branch, investigators are expected to examine the role of bank officials and any other individuals who might have facilitated the fraud. Further raids and questioning are likely in the coming days as the probe continues.

This case highlights the rising incidents of banking fraud in India, particularly involving loan scams, fake valuations, and financial misrepresentation. Authorities have reassured that strict action will be taken against those found guilty, and SBI is expected to strengthen its internal verification processes to prevent such frauds in the future.