Police probing complicity of banks in fraud case

BANGALORE: City police are probing the 'complicity of banks' in a fraud case in which two persons were arrested on the charge of duping several nationalised banks to the tune of Rs 1.6 crore, a senior police official said.

"It is impossible to understand how these banks could have sanctioned the loans on the basis of fabricated documents without verification", Deputy Commissioner of Police (Central Divsion) B N S Reddy said on Friday.   

The banks have a legal cell to verify documents before sanctioning any loan. "Simple physical verification of the documents would have shown that these were fake", he said.

The fact that banks have overlooked the loopholes and sancitoned the loans reveals "complicity between the bank's legal cells and the two accused, which is being probed now" Reddy said.

"We hope to get some definite leads very soon", he said.

The duo, Govinda Reddy (66) and Shivaswamy (40) were arrested on August 29 for cheating banks, including ICICI, HSBC, Vijaya Bank, State Bank of Mysore and others to tune of Rs 1.6 crore.