90% of illegal money came from 30 banks; 10% cash deposits: Bank of Baroda

Mangalore Today News Network

New Delhi, Oct 13, 2015: Bank of Baroda on Monday said the total value of illegal remittances through its Ashok Vihar Branch in New Delhi was $546.10 million (around Rs 3,500 crore), much lower than Rs 6,000 crore estimated by the CBI on Saturday.

The bank also admitted that its branches accepted 10 per cent of this amount (around Rs 350 crore) as cash deposits, leading to uncomfortable questions about the source of the money and where it was headed. The balance amount of over Rs 3,000 crore came from 30 banks.

“The branch did not adhere to FEMA guidelines in remittances,” BoB said in a stock exchange filing.

On Saturday, a CBI statement had said, “59 current account holders and unknown bank officials conspired to send overseas remittances, mostly to Hong Kong, of foreign exchange worth approximately Rs 6,000 crore in illegal and irregular manner in violation of established banking norms under the garb of payments towards suspected non-existent imports.”

According to BoB, during the period May 15, 2014, to August 2015, a total of 5,853 outward foreign remittances transactions aggregating $546.10 million (around Rs 3,500 crore) for the purposes as ‘Advance remittance for imports’... have been remitted through 38 current accounts to various overseas parties numbering about 400, mainly in Hong Kong and one of them in Dubai.

“Out of the total amount involved, only about 10 per cent (around Rs 350 crore) has been by way of cash deposits with our branches and rest of around 90 per cent have been received by RTGS/ NEFT from various other banks numbering over 30,” BoB said. In 33 accounts where cash transaction took place, regular cash transaction reports CTRs) were generated and mailed to the Financial Intelligence Unit (FIU) as there have been frequent cash deposits, it said.

BoB said the matter came to its notice in the middle of July 2015 and then the bank ordered an investigation. This report was submitted on August 31, 2015, at the Regional Office level and the matter was escalated to the corporate office which ordered a detailed investigation by the bank’s internal audit division which was commenced on September 22, 2015. “The matter was reported to the CBI, the Enforcement Directorate and the finance ministry on September 24,” it said.

“There’s no financial loss to the bank at present or it may be insignificant,” BoB said.

Bank of Baroda shares ended the day over 3 per cent lower after the CBI carried out searches at three locations in New Delhi in connection with alleged Rs 6,100 crore remittances sent from BoB to Hong Kong camouflaged as payments for non-existent imports.

After plunging 7.84 per cent to Rs 168 in intra-day trade, shares of the company finally ended at Rs 176.10, down 3.40 per cent on Bombay Stock Exchange.

CBI sources on Saturday said searches were conducted by joint team of CBI and ED at three premises including the Bank of Baroda, Ashok Vihar Branch in Delhi apart from residences of BoB AGM SK Garg and Jainish Dubey, who is a foreign exchange officer with the bank. CBI sources said the two officials have been found to be involved in the illegitimate transfer of the amount to Hong Kong. These two officials were suspended by the bank.

 

Courtesy: Yahoo.com