The Mumbai Police have registered a case of fraud amounting to Rs 122 crore against senior officials of New India Cooperative Bank, just two days after the Reserve Bank of India (RBI) imposed strict restrictions on the bank over alleged financial irregularities.
The case has been filed against Hitesh Mehta, the bank’s General Manager and Head of Accounts, based on a complaint by the bank’s CEO, Devarshi Shishir Kumar Ghosh (48). According to the complaint, Mehta and his accomplice were responsible for safeguarding cash at the bank’s Prabhadevi and Goregaon branches. However, they allegedly conspired and embezzled Rs 122 crore between 2020 and 2025.
Case Transferred to Economic Offences Wing
Following the complaint, the Dadar Police registered an FIR against Mehta under Sections 316(5) (criminal breach of trust by a public servant or banker) and 61(2) (criminal conspiracy) of the Bharatiya Nyaya Sanhita (BNS). The case has now been handed over to the Economic Offences Wing (EOW) for further investigation.
In his police complaint, Ghosh said that Mehta and his accomplice were trusted employees of the bank and the cash in the bank’s vaults at its Prabhadevi and Goregaon offices was in their safe custody. But the two allegedly hatched a criminal conspiracy and embezzled about Rs 122 crore.
According to the complaint, the alleged scam took place between 2020 and 2025.
RBI Imposes Strict Restrictions on the Bank
The RBI’s action against the bank has caused panic among depositors. On Friday, thousands of customers lined up outside the bank’s branches, seeking clarity on whether they could withdraw their savings.
The RBI’s restrictions, which came into effect from February 13, prevent the bank from:
- Issuing new loans
- Making investments
- Borrowing funds
- Allowing withdrawals without RBI’s approval
The bank’s board of directors has been superseded for 12 months due to “poor governance standards.” The RBI has appointed Shreekant, a former Chief General Manager of SBI, as the administrator to manage the bank’s affairs. A committee of advisors has also been formed to assist him.
Financial Troubles and Past Losses
The New India Cooperative Bank operates 30 branches and has a deposit base of Rs 2,436 crore as of March 2024. However, the bank has been struggling financially, reporting losses of Rs 22.78 crore in 2023-24 and Rs 30.74 crore in 2022-23.
This is the biggest action against a cooperative bank in Maharashtra since the Punjab and Maharashtra Cooperative (PMC) Bank scam, which collapsed due to large-scale fraudulent loans.
The RBI restrictions will remain in place for six months, with further actions depending on the ongoing investigation.
