CBI books textile firm S. Kumars for bank fraud | #phishing | #scams

The Central Bureau of Investigation (CBI) has registered a case against textile company S. Kumars Nationwide Limited for allegedly cheating a consortium of the Union Bank of India and the erstwhile Corporation Bank to the tune of ₹160.68 crore.

Among the accused persons in the case are Nitin Kasliwal, Vijay Kalantri, Anil Kumar Channa, Rajinder Krishan Garg and Jagadeesh Sanjeeva Shetty, according to the First Information Report (FIR).

Doubtful transactions

The banks alleged that 94% of the sales shown by the company were to select distributors; it wrote off receivables from the customers; there were doubtful re-sale transactions to the same customers at hugely discounted prices; and there were transactions with two potentially linked customers.

The FIR alleged that 75% sales and purchase transactions were done with non-operating entities; and that auditors of the borrower company had also invested in it. The alleged transactions took between 2013 and 2018.

It was alleged that balance receivables of ₹1,044.25 crore from the customers were written off during March 2016. Stock worth ₹1,215.54 crore was revalued at ₹537.72 crore, resulting in a loss of ₹677.92 crore. While the revaluation was done on September 30, 2014, its report was not made available by the company.

The stock returned by 13 customers amounting to ₹2,322.62 crore was sold back to the same customers for ₹703.53 crore, resulting in a loss of ₹1,619.09 crore. The reason for selling the returned goods back to the same customers was not given by the company, as alleged.

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