Icici Bank Scam

ICICI BANK SCAM CASE
Chanda Kochhar is the former managing director and chief executive officer of ICICI Bank.
However, on 4 October 2018 she stepped down from her position following allegations of
corruption. Amidst investigations related to Videocon bad loans, she was forced by the board of
ICICI Bank to take indefinite leave. The Central Bureau of Investigation named Chanda Kochhar
and her husband as beneficiaries in the financial fraud. The Justice B N Shrikrishna probe panel
reported that Kochhar had violated ICICI Bank's Code of Conduct, following which her service
was terminated with all her entitlements and benefits revoked.
The Enforcement Directorate has registered a criminal case of money laundering against former
ICICI Bank Chief Executive Officer Chanda Kochhar, her husband Deepak Kochhar, Videocon
Group promoter Venugopal Dhoot and others to probe alleged irregularities and corrupt practices
in sanctioning of Rs 1,875-crore loans by the bank to the corporate group, officials said on
Saturday. They said the central probe agency filed an Enforcement Case Information Report
under the Prevention of Money Laundering Act, taking cognisance of a Central Bureau of
Investigation’s complaint filed on the matter last month. An ECIR is the ED's equivalent of a
police FIR.
According to CBI officers, six high-value loans were sanctioned to various companies under the
Videocon Group from June 2009 to October 2011.
“In August 2009, a term loan of ₹300 crore was sanctioned to Videocon International Electronic
Ltd. in contravention of the rules and policy by the sanctioning committee. Ms. Kochhar was part
of this committee,” a CBI officer said.
The CBI on Thursday, conducted searches at four locations in Mumbai and Aurangabad,
including the offices of Videocon Group, Nupower Renewables Limited (NRL) and Supreme
Energy Private Limited (SEPL).
The raids followed the registration of a FIR against former ICICI CEO Chanda Kochhar, her
husband Deepak and Videocon Industries MD Venugopal Dhoot in connection sanction of credit
facilities by the bank to the tune of ₹1,730 crore allegedly in violation of rules.
Among those named in the FIR are Mr. Kochchar’s company NRL, Videocon International
Electronics Limited (VIEL), Videocon Industries Limited (VIL) and SEPL.
The role of K.V. Kamath, currently the bank’s non-executive chairman, Sandeep Bakshi, who
replaced Ms. Kochhar, K. Ramkumar, Sonjoy Chatterjee, N.S. Kannan, Zarin Daruwala, Rajiv
Sabharwal and Homi Khusrokhan may also be investigated, the agency said, though these
officials have not been named in the FIR. These officials were members of several committees
that sanctioned ₹1,575 crore in loans on various dates.
RBI rules flouted:
The CBI case has been registered on the basis of a preliminary enquiry (PI) instituted on
December 8, 2017.
During the inquiry, the CBI found that between June 2009 and October 2011, the bank had
sanctioned six high-value loans to various Videocon Group firms. On August 26, 2009, ₹300
crore was sanctioned to VIEL in alleged violation of rules. Ms. Kochhar was a member of the
sanctioning committee. On September 7, 2009, the loan was disbursed and the very next day,
Mr. Dhoot transferred ₹64 crore to NRL via SEPL, as alleged.
This was the first major capital received by NRL to acquire its first power plant,” a CBI officer
said.
The officer added that five other loans, collectively amounting to ₹1,575 crore were sanctioned
to various companies of the Videocon group, including for refinancing the existing loans of the
company, in violation of the credit policy of the bank.
According to the FIR, NRL was incorporated in December 2008 and Mr. Kochhar, Mr. Dhoot
and one Saurabh Dhoot were its directors. The Dhoots resigned in January 2009. However,
before doing so, the Videocon Group chief allotted over 19.9 lakh warrants valued at ₹10 per
unit, to Mr. Kochhar on an initial payment of ₹1 per warrant.
In the case of SEPL, the agency said it was set up in July 2008 by Mr. Dhoot and his associate
Vasant Kakade. Mr. Dhoot resigned as a director in January 2009 and transferred the
company’s control to Mr. Kochhar by offloading his shares in favour of Pinnacle Energy Trust.
A loan was also sanctioned to Videocon Industries for refinancing its existing loans.
The credit limits in question were sanctioned after Ms. Kochhar took charge of ICICI Bank as
MD & CEO in May 2009. She was a committee member that sanctioned a loan of ₹750 crore to
VIL and ₹300 crore to VIEL, the CBI alleged. As on April 26, 2012, the outstanding against six
loan accounts were adjusted as another term loan of ₹1,730 crore sanctioned under refinance of
domestic debt.
The account of VIL and its group companies were declared non-performing assets in June 2017.
Meanwhile, shares of Videocon Industries fell 2.29% at ₹2.86 on Thursday, valuing the
company at ₹95.66 crore.

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ICICI BANK SCAM CASE

RBI rules flouted:

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