Mumbai: 2 Developers Collude With Banks, Trap Several Homebuyers In Fraudulent Subvention Scheme

Mumbai: Two Mumbai-based developers in collusion with financial institutions duped several homebuyers by trapping them in the subvention scam, found the CBI during its pan-India probe following directions from the Supreme Court.

About The Case

Explaining how the scam works, the Central Bureau of Investigation (CBI) said that the probe revealed that M/s ACME Realties Pvt Ltd and M/s Shashwati Realty Pvt Ltd, through its directors, connived with officials of financial institutions. These developers wooed buyers, with advertisements promising that they do not need to pay EMI till possession, said the agency. However, when the builders failed to pay loan installments, the accused financial institutions started deducting EMI from the buyers' accounts, it added.

In the event of default, the accounts of buyers were flagged as non-performing assets (NPA), thereby affecting their CIBIL score. “The financial institutions approved the subvention plan of the builders and disbursed home loans to the account of the builder companies without exercising any due diligence, causing undue pecuniary advantage to the builder,” the FIR stated. It further said that the builder companies defaulted in payment of preEMIs and did not complete the project/flats.

“In this manner, builders neither delivered possession of the residential units to buyers nor refunded their deposited amount, while misappropriating the entire upfront booking amount/loan amount,” read the FIR. It clearly indicates that the buyers have been cheated by the builders in cahoots with unknown officials of the financial institutions, the CBI officials stated. Last month, the agency registered cases against banks and real estate developers across Mumbai, Bengaluru, Kolkata, Mohali and Prayagraj.

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