Cyberabad police busts bank guarantee fraud, arrests MD of company

Hyderabad: Economic Offences Wing of Cyberabad on Friday arrested the director of a private company for cheating the Union Bank of India.

The director allegedly cheated the bank by creating forged bank guarantees. Two cases were registered against the company and four of its directors in Cyberabad limits. The director along with his associates has reportedly cheated the bank to the tune of Rs 53 crores.

As per the information provided by the police, the director has established Kompass Infrastructures Private Limited, a company that undertakes civil contract works.

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For procuring materials from different supplier companies, the accused has taken bank guarantees from the Union Bank of India. Based on the bank guarantees, eight of the companies supplied materials to him.

For taking bank guarantee from the bank, he has kept properties of one of the directors as securities and his maximum sanction limit to take bank guarantees is 15 crores as per the bank norms. Beyond the sanctioned limit, the bank guarantee should be closed or renewed at the bank to get a new bank guarantee in its place.

In order to get material from different companies beyond the sanctioned limit prescribed by the bank, the accused created forged bank guarantees and submitted them to the companies as if they were issued by the bank.

In order to get the new bank guarantee, he took the bank guarantee already submitted to the companies and returned it to the banks with forged letters of the companies.

By this modus operandi, he has obtained 39 bank guarantees from the complainant bank and cheated to the tune of 53 crores.

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