The Konkan Vikas Cooperative Credit Society, Naigaon, Mumbai, has accused former officials of embezzling funds under the guise of loans. The scam amounts to more than INR 1.5 Crore. According to the FIR, the modus operandi was creating fake loans. The 2023-2024 financial audit uncovered the fraud.
The auditors state that two former employees created four fake creditors. They then took loans ranging from INR 39 Lakh to INR 45 Lakh. Upon investigation, authorities identified the person who signed the documents. The ongoing investigation will determine the involvement of any other members. The fake loans saw disbursal in 2015 and 2020.
The FIR states that the former employees have acknowledged their wrongdoing. They have confessed to creating four fake profiles, taking loans against them, and failing to repay the loans. The accused are residents of Bhoiwada. While the crime itself is intriguing, it will also reveal how the loan remained unpaid for over 10 years and how bank officials were able to create multiple fake accounts.
Sections for Konkan Vikas Co-Op Credit Society Fake Loan Scam
The case falls under the provisions of the Bharatiya Nyaya Sanhita, specifically Sections 420, 409, and 34. Section 420 deals with cheating and dishonestly inducing the delivery of property. Section 409 of the Indian Penal Code (IPC) pertains to criminal breach of trust by a person in a position of authority, such as a public servant, banker, merchant, or agent. It is a stringent provision aimed at punishing those who misuse their position of trust for personal gain, especially when they are entrusted with property or have control over it due to their professional capacity.
Under Section 409, if a person dishonestly misappropriates entrusted property, they can be held criminally liable. The law considers this an aggravated form of criminal breach of trust, due to the position of trust and responsibility.
Section 34 of the Indian Penal Code (IPC) deals with acts done by several persons in furtherance of a common intention. According to this section, when a criminal act is committed by multiple persons in furtherance of a common intention, each is held equally liable for the act as if they had done it alone. This means that even if one person physically commits the act, others involved in planning or assisting with the intent to commit the same offence can also be punished equally.
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This provision is often invoked in cases of group crimes like robbery, assault, or murder, where multiple people are involved. Section 34 ensures that individuals who act together with criminal intent cannot escape liability merely because they did not personally execute the act.
In such scenarios, the role of bank officials definitely comes into question. This incident will remind readers of the now-infamous New India Co-operative Bank scam. Allegedly, a bank official gave friendly, off-the-book loans worth crores to friends and well-wishers. That scam could run in thousands of crores. The Konkan Vikas Cooperative Credit Society fake loan scam seems to be a smaller one. However, it is unclear whether an investigation will reveal more such phoney bank accounts and loans.
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