Promoter of Housing Development Infrastructure Ltd (HDIL) Rakesh Wadhawan and Waryam Singh, the former chairman of Punjab & Maharashtra Co-operative (PMC) Bank Ltd, were sent to police custody till October 14 by Mumbai's Esplanade Court on Wednesday.
Both Wadhawan and Singh have been arrested by the Economic Offences Wing (EOW) of the Mumbai police for their involvement in the Rs 4,355.46-crore PMC Bank fraud. PMC Bank is under regulatory restrictions after the Reserve Bank of India found out financial irregularities in its functioning, hiding and classification of loans given to HDIL.
PMC Bank has an exposure of over Rs 6,200 crore to HDIL. The real-estate firm is also facing bankruptcy proceedings at the National Company Law Tribunal (NCLT) under the Insolvency and Bankruptcy Code.
In the FIR, police said the actions of the accused allegedly led to bank losses totaling Rs 4,355.46 crore. The ongoing investigation has found that there were nearly 44 accounts at the bank that were password-protected.
The Indian Express has also reported that both Wadhawan and Singh were not only colleagues at the real-estate company but had together started a firm that breeds race horses.
Wadhawan Livestock Pvt Ltd was set up in August 2007 by Wadhawan, Singh and Ashok Kumar Gupta, a former independent director of HDIL, to “import, export, breed horses for racing” and has horses worth Rs 64 crore as on March 2018, according to the latest annual report of the company.
Shares of HDIL extended its losses today as it fell nearly 5 per cent and hit its lower circuit limit after reports that Mumbai Police's EOW may include the auditors of the bankrupt company in the probe.