Vijay Mallya loan case: CBI arrests eight officials of Kingfisher Airlines and IDBI Bank

The CBI on Monday four former executives of IDBI Bank including a former chairman of the bank in the alleged money laundering case involving beleaguered businessman Vijay Mallya.

New Delhi: The Central Bureau of Investigation (CBI) on Monday four former executives of IDBI Bank including a former chairman of the bank in the alleged money laundering case involving beleaguered businessman Vijay Mallya.

The CBI also arrested four former executives of Kingfisher Airlines in the related case.

Those arrested include the then Chairman of IDBI Bank Yogesh Aggarwal and former CFO of now-defunct Kingfisher Airlines A Raghunathan, CBI sources said.

According to report, the CBI arrested the former chairman of IDBI Bank in loan case and later arrest four executives of Kingfisher Airlines along with other three more former executives of the bank.

4 executives of #KingfisherAirlines & 3 more former executives of #IDBI Bank also arrested by #CBI: Sources

— Press Trust of India (@PTI_News) January 23, 2017

The arrests were followed by searches at 11 places including Mallya's residence here, three floors of UB towers in Bengaluru and residences of Aggarwal and Raghunathan among others.

Earlier during the day, the investigating agency was reported to have visited the UB Group's offices in Bengaluru.

"A team of CBI officials from Delhi visited the UB group offices in Bengaluru," a senior CBI official told PTI but did not divulge any details.

"I do not have any details on the issue," he said.

Meanwhile, the UB Group spokesperson also confirmed the visit of the CBI officials to their offices and stated that they were cooperating with them.

"A CBI team visited the UB Group offices in Bangalore? (Bengaluru) today and we are fully cooperating with them," the?spokesperson said.

Other IDBI executives arrested by CBI include O V Bundellu, S K V Srinivasan and R S Sridhar, they said.

The sources said besides former CFO of Kingfisher Airlines, three more former executives Shailesh Borke, A C Shah and Amit Nadkarni were also arrested.

The arrests have been made from multiple cities. While Raghunathan was arrested in Mumbai, Aggarwal was taken into custody from Gurgaon, the sources said.

CBI has alleged that Aggarwal approved the loans and also instructed to expedite the ratings while finalising the loans to Kingfisher Airlines of over Rs 900 crore.

The agency had alleged that loans were issued by accepting Kingfisher brand as hypothecation, lease aircraft and guarantees from UB group and Mallya himself.

During the probe, CBI had come across alleged communication from Raghunathan to IDBI bank in which he had referred to meetings between Mallya and Aggarwal. The agency is investigating if the loan disbursal took place after these meetings.

CBI had registered a case against Mallya, Director of defunct Kingfisher Airlines; the company; A Raghunathan, Chief Financial Officer of the Airlines; and unknown officials of IDBI Bank.

The loan was allegedly sanctioned in violation of norms regarding credit limits.

The sources said there was no need for the bank to take the exposure outside the consortium.

"It was first exposure to the bank. There was no need for the bank to take the exposure outside the consortium when already other loans were getting stressed," a senior CBI official, probing the matter, had earlier said.

Rs 250 crore of loan given by IDBI Bank was allegedly routed through different bank accounts of Kingfisher Airlines which had stopped operations in 2012 following huge debts.

Mallya, who has moved to Europe last year, is facing another CBI case which was filed on the basis of complaint from State Bank of India which is one of the lenders to the Kingfisher Airlines in connection with Rs 1,600 crore of alleged default.

The CBI said a case has been registered against Mallya and others after receiving a complaint from State Bank of India, which is leading a consortium of 17 banks that have given loans to Kingfisher Airlines.

The airline, owned by Mallya, had taken Rs 6,900 crore from a consortium of 17 lenders in early 2010 after a second debt restructuring for the airline.

With PTI Inputs