MP's Apex Bank officials indicted in home loan scam

Three officials of the Madhya Pradesh's top cooperative bank, Apex Bank, were indicted for housing loan scam, according to a probe report. Nearly 30 housing loans were sanctioned flouting every prudential norm, said the report.

The report, which was submitted to the Apex Bank managing director Sunil Mishra in Bhopal, clearly indicates a nexus among bank managers, middlemen and the beneficiaries. Confirming the receipt of the report, Mishra said that the report was being examined.

The probe team found that in a couple of cases, loans were disbursed without even an application being moved. It has found the involvement of three bank managers-V K Verma, manager of the MP Nagar branch in Bhopal, Ravi Thakkar, manager at the Ujjain branch and R K Dubey who has since retired.

The report notes that the credentials of the guarantors are also suspect in most of the cases. In a couple of cases, the manager sanctioned a loan of Rs five lakh against the guarantee of a driver in a private firm, whose monthly income is barely Rs 3,000.

In all these cases, loans were sanctioned for construction of houses in Nilbad on the outskirts of Bhopal.

While disbursing the loan amount in stages, progress on the construction work was not monitored.

Consequently, many of the houses remain incomplete though the entire loan amount has been disbursed.

Moreover, the bank fumbled again in giving insurance cover "believing" that the houses were built and completed as per the specified plan. In some cases, the entire loan amount was disbursed within three months.