Rs 100 crore deposit of Gurdwaras locked in fraud-hit PMC Bank

The Gurdwaras, which have their accounts with PMC Bank, are agitated with RBI's curb in withdrawing money from the bank.

Rs 100 crore deposit of Gurdwaras locked in fraud-hit PMC Bank

Several Gurdwaras had deposited about Rs 100 crore in the fraud-hit Punjab and Maharashtra Cooperative Bank but the present crisis has meant that they are unable to withdraw their money. The Gurdwaras which have their account with PMC Bank are agitated over the curb in withdrawing money and point out that the fund crunch means they are unable to prepare for Gurpurab which falls on November 12, 2019.

PMC Bank account holders have been allowed to withdraw Rs 25,000 from the bank in the next six months. The curb on withdrawal has been imposed by the Reserve Bank of India (RBI) after the fraud came to light. The apex bank had initially allowed the withdrawal of only Rs 100 within six months which was later increased to Rs. 10,000 and then hiked to Rs 25,000 on Thursday (October 3, 2019).

RBI Chief General Manager Yogesh Dayal in a press release stated that the decision has been taken after reviewing PMC Bank's liquidity position and in order to reduce the hardships faced by the depositors.

Mumbai Police has also arrested four people in connection with the scam. Those arrested are Joy Thomas, the suspended Managing Director of the PMC Bank, promoters of debt-ridden Housing Development and Infrastructure Ltd (HDIL) Rakesh and Sarang Wadhawan, and former bank chairman Waryam Singh.

HDIL promoters and senior bank officials created a massive web of deceit to defraud the financial organisation of almost Rs 4355.46 crore, according to the FIR registered by the Economic Offence Wing of Mumbai Police. The FIR also states that PMC Bank officials opened around 21,049 dummy accounts to mask loan accounts. The dummy accounts were not even linked to the bank's CBS to hide loans given to defaulters.

Even though these loans were not being repaid, bank management did not raise a red flag or classify them as non-performing advances with the RBI, too, not being informed.

PMC Bank has 137 branches and over Rs 11,000 crore in deposits.

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