A major bank loan fraud has come to light in Kanpur, Uttar Pradesh, where a man is accused of setting up fake companies to obtain loans worth thousands of crores from public sector banks. According to a report by Navbharat Times (NBT), the police have arrested Rajesh Bothra in connection with a ₹32 crore loan fraud case.
As per ET, Investigators allege that most of the companies promoted by Bothra existed only on paper and had little or no real business activity. On January 7, a CBI court in Lucknow rejected Bothra’s bail application, citing the seriousness of the allegations, the NBT report said.
The investigation has also raised questions about a small shop on Birhana Road in Kanpur, which was shown as the registered address of one of the companies. Officials say the shop was mostly non-operational and showed no signs of regular commercial activity, yet the company registered at that address managed to secure large loans from banks. After Bothra’s arrest, agencies began examining loans taken by several firms linked to the same address.
According to bank records and findings of the Central Bureau of Investigation (CBI), Bothra had promoted three companies under the ‘Frost’ group. Although these firms were shown as separate legal entities, investigators say they were controlled by the same individuals. Decision-making, financial transactions, and fund transfers across these companies were allegedly handled by Bothra and his close associates, creating the appearance of multiple businesses while operating as a single network.
An FIR registered on March 19, 2021, names several public sector banks in connection with the alleged fraud. However, enforcement action has so far moved forward in only one case. Bothra’s arrest is linked specifically to the ₹32 crore loan, while investigations related to other banks are still ongoing.
Officials say the case has exposed serious gaps in loan appraisal and monitoring systems. Companies with minimal physical presence and weak business operations were able to secure large amounts of credit from government-owned banks. As the probe continues, agencies are assessing the total loan exposure linked to the Frost group companies and examining the possible role of bank officials involved in approving the loans.
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