Chanda Kochhar, former managing director and chief executive officer of ICICI Bank, is in trouble all over again.
Kochhar (62) along with 10 others, including senior officials of ICICI Bank and Oriental Bank of Commerce (now Punjab National Bank), have been booked for allegedly cheating a private company.
The case is of 2009 and after a protracted legal battle the Patiala House court recently directed the Delhi Police to register a case and begin investigation, according to the New Indian Express.
FIR registered on December 20
Following this, the Economic Offence Wing (EOW) of the Delhi Police registered a First Information Report (FIR) on December 20 under various sections of the Indian Penal Code (IPC) dealing with cheating, criminal conspiracy and other offences against Sandeep Bakshi, managing director and CEO of ICICI Bank, Vijay Zagade, ex-manager of ICICI Bank, unnamed officials of ICICI Bank posted at Global Trade Services unit, Mumbai, Atul Kumar Goel, managing director and CEO of Punjab National Bank, KK Bordia, ex-general manager of Oriental Bank of Commerce, Akhila Sinha and Manoj Saxena, assistant general managers of Punjab National Bank and KK Bhatia, former-chief manager of Oriental Bank of Commerce.
According to the FIR filed by Shammi Ahluwalia, director of P&R Overseas Pvt Limited, also known as Tomato Magic, the accused allegedly conspired to project a fake ‘Letter of Credit’, offered by a ‘foreign bank’, as a genuine document and verified its legality. A Letter of Credit is a document from a bank guaranteeing payment to a seller under certain conditions.
The complainant had received an export order from a Russian buyer for the supply of 1,000 metric tonnes of Chinese tomato paste for $10 lakh. The amount was increased to $18.48 lakh for an additional supply of Iranian-origin tomato paste.
ICICI was advising the ‘A’ class bank
As per payment risk, the condition was that the order shall be premised on a 100% irrevocable ‘Letter of Credit’ issued by an ‘A’ class bank of international repute. In this case, ICICI was the advising bank.
Accordingly, the complainant received the ‘Letter of Credit’ through ICICI Bank purportedly issued by the Royal Bank of Scotland (RBS). However, later it was found out that the LoC was issued by a bank, named RBS Alliance, Moscow, which did not have a good track record in honouring its documentary credits.
“ICICI Bank fraudulently authenticated the LoC as issued by the Royal Bank of Scotland knowing well that it was from a Russian bank. The said LoC was amended thrice and ICICI committed the same mistake on all three occasions,” the FIR read.
Details of the FIR
As per the FIR, ICICI Bank in May 2011, in one of its replies to the complainant tried to “escape responsibility” by giving “frivolous” and “untrue” answers. “The complainant forwarded the letter of May 2011 to accused No. 6, which was Oriental Bank of Commerce. Surprisingly, the bank did not challenge the stand taken by ICICI, thus, consented to the correctness,” the FIR stated.
The complainant claimed that she incurred a loss of Rs 27.66 Crores in the process.