Seva Vikas Bank scam | Court sends BJP leader Amar Mulchandani to ED custody

A special court in Mumbai remands BJP leader and ex-chairman of Seva Vikas Cooperative Bank, Amar Mulchandani in the bank scam of ₹429 crore to ED custody till July 7.

A special court in Mumbai has remanded a Bharatiya Janata Party’s leader and ex-chairman of Seva Vikas Cooperative Bank, Amar Mulchandani in the case related to ₹429 crore bank scam to Enforcement Directorate’s (ED) custody till July 7.

Mr. Mulchandani, the former corporator of the Pimpri Chinchwad Municipal Corporation (PCMC) was earlier with the Congress and joined the BJP in 2016. He was arrested on July 1 this year under the Prevention of Money Laundering Act, 2002.

According to ED, the arrest is made because of the bank fraud case in which the bank suffered a loss of ₹429 crore in 124 non-performing assets loan accounts. “This caused the bank to go bankrupt causing loss to thousands of small depositors”, ED states in a press release.

The central agency’s investigation is basis of multiple First Information Reports registered in Pune against Mr Mulchandani along with its directors/officials and loan defaulters. In August 2021, he was arrested in same case by Pimpri Chinchwad police but was granted bail in six months.

As per ED, “The bank was being run like a family proprietorship by Amar Mulchandani. He treated public deposits in the Bank like his personal fiefdom and violated all prudent banking norms to illegally sanction loans to his favoured borrowers in arbitrary manner, without checking their credit worthiness and without adequate collateral securities and after taking bribes at the rate of 20% commission of the sanctioned loan amounts.”

He made his family members as Directors in the bank with a clear motive to have brute majority in Board of Directors to sanction loans as per his whims and fancies. More than 92% of the loan accounts had turned NPA which ultimately led to the collapse of the bank. RBI has cancelled the license of the bank.

In May this year, ED had attached properties in Pune worth ₹122.35 crore belonging to Mr Mulchandani and his family members. He was produced in a court in Mumbai and has been sent to ED custody till July 7.