Yavatmal Bank officials in ACB dragnet over embezzlement

The residential and office premises of the chairman of Yavatmal District Central Cooperative Bank and eight others including the bank manager and president of the employees' union were raided by the anti-corruption bureau (ACB) here on charges of embezzlement of funds worth several lakhs.

The police later arrested Vijay Chavan, chairman, of the bank, Devrao Jibhkate, manager, and Mukund Kale, employees' union chief. Offences were also registered against the remaining eight including Bhaurao Thakre, former principal of Pusad-based Vasantrao Naik Engineering College, and one Pradip Kavthekar's of a computer firm, Supertech Solution, Pune.

Prima facie evidence indicates that the bank lost over Rs 76 lakh in just one contract order for computerisation of banking operations and several more lakhs in distributing wage arrears to the employees.

The complaint with the Yavatmal police was lodged by deputy superintendent of police (ACB, Nagpur) Bhanudas Sonawane. Ravindra Kadam, superintendent of police, ACB, told newsmen that the action was taken after investigating a specific complaint lodged with the ACB by Suresh Bhuse, who heads a rival and minority trade union in the cooperative bank. Bhuse had in his complaint alleged large scale corruption in computer purchases and in grant of pay hike to employees.

Kadam said that various irregularities came to light during the investigations. The bank had apparently decided to go in for computerisation despite poor fiscal health. No permission was sought for the exercise either from the bank's board or from the Registrar of Cooperatives. In addition, no expert in computerisation was consulted before finalising the deal.

The bank manager appointed Bhaurao Thakre as an advisor for the deal and for after sales services. Serious doubts have been raised about Thakre's knowledge concerning computers. A tender of Rs 1.25 crore was floated for the first phase of computerisation.

Surprisingly, the tender notice was published in a newspaper from Nanded district. Moreover, differences were found between the tender notice published in the newspaper and the original one contained in bank file records.

In response to the tender notice, Pradip Kavthekar's Supertech Solution, Pune, Abhishek Engineering, Amravati, Radha Computers, Aurangabad, and Sukrut Marketing of Kolhapur bid for the contract. As the bid by Supertech Solution was lowest, the computer supply order was awarded to it as per recommendation of advisor Thakre.

Investigations later revealed that all the bids except the one from Pune, were bogus. Kavthekar was the mastermind behind the plan. Later, the bank took a decision to take up computerisation in the second and third phases.

Although, the price of computers had come down considerably, the bank did not invite fresh tenders and placed the supply order again with Supertech Solution. The orders collectively amounted to Rs 3,49,72,000 and the bank incurred a loss of Rs 76,23,538 as the rates quoted by the company were higher than the prevailing market rates.

Police contend that such embezzlement of funds was not possible without the knowledge of both the chairman of the bank and the manager. Vijay Chavan, Jibhkate, Thakre and Kavthekar were booked under sections 120 (B), 465, 467 and 468 of the IPC besides relevant sections of the Anti-Corruption Act.

In the other case, although an agreement was reached between the bank management and employees regarding wage settlement, Chavan had allegedly in connivance with the leaders of the union and certain employees pressed for cancellation of agreement.

After announcing a pay hike, the chairman directed the employees to deposit 50 per cent of their arrears in the account of the union. Complaints were also received that Chavan demanded Rs 15 lakh from the union's account.

The ACB investigated the case and found some substance in the complaints. For demanding a bribe of Rs 15 lakh in lieu of the pay hike and helping Chavan in the matter, offences were registered against Jibhkate, Mukund Kale, Ghanshyam Dhobe, secretary and members Vijay Uplenchwar and Narayan Muley.

The ACB team conducted simultaneous raids at Yavatmal, Pune, Pusad and Mumbai residences of Vijay Chavan.

Earlier Datey, district deputy registrar, had conducted a probe into the computer purchase by the bank and passed strictures against the corruption involved in the deal in his report.