ACB carried out extensive searches at the house of over a dozen accused bank officials at Nine locations in Kashmir, Four in Jammu and Three in Delhi. The houses of REI Agro's chairman Sanjay Jhunjhunwala and vice president Sandeep Jhunjhunwala were also searched in Delhi.
The ACB registered a Preliminary Enquiry on allegations that the officials of the bank's branches at Mumbai's Mahim and Delhi's Ansal Plaza had sanctioned loan of Rs800 crores in favor of REI Agro-Based on fake documents, and in violation of the laid-down banking procedure between 2011 to 2013, which resulted in the accounts becoming non-performing assets in 2014, thereby causing a huge financial loss to the bank.
REI Agro has shown its head office in Kolkata and corporate office in New Delhi, approached the Mahim branch of the bank, even though it did not have an office in Mumbai, and got loans or advances worth Rs 550 crores.
The company approached the Mahim and Vasant Vihar branches of the bank for sanctioning the advances to make payments to farmers, following the terms, and conditions of the bank. The farmers were supposed to provide paddy to the company and in turn, it should sell and produce and clear the loan amount of the bank in installments. The objective was to divert the loan amount for its own benefits.