New India Co-operative Bank Fraud: Ex-GM Booked for Allegedly Siphoning ₹122 Crore
In a major financial fraud case, Mumbai Police have registered an FIR against Hitesh Praveenchand Mehta, the former General Manager of New India Co-operative Bank, for allegedly siphoning ₹122 crore from the bank’s treasury. Mehta, who was responsible for managing the Dadar and Goregaon branches, is accused of misusing his position over a period of five years (2020-2025) to orchestrate financial irregularities, as per a report from ANI.
The case was filed following a formal complaint from the bank’s Chief Accounts Officer at Dadar Police Station. Initial investigations suggest that Mehta may not have acted alone, prompting authorities to look into possible accomplices. Given the magnitude of the financial fraud, the case has now been transferred to the Economic Offences Wing (EOW) for an in-depth investigation.
FIR Registered Under Financial Crime Provisions
The First Information Report (FIR) against Mehta has been registered under the Bharatiya Nyaya Sanhita (BNS) sections 316(5) and 61(2), which deal with serious financial offenses, including criminal breach of trust and fraudulent misappropriation of funds.
Authorities believe the fraudulent activities were systematic and premeditated, leading to significant losses for the bank and its customers. Investigators are currently analyzing banking records, internal communications, and transaction histories to ascertain the full extent of the scam.
RBI Takes Strict Action Against New India Co-operative Bank
Following serious governance and financial mismanagement concerns, the Reserve Bank of India (RBI) has imposed stringent restrictions on New India Co-operative Bank to prevent further financial instability.
Key RBI Actions:
- Suspension of New Loan Approvals and Deposit Acceptance
- The bank is prohibited from granting or renewing loans and accepting fresh deposits without prior RBI approval.
- Suspension of Payments
- The bank cannot disburse funds, except under specific RBI-sanctioned conditions.
- Supersession of the Bank’s Board of Directors
- The RBI has dissolved the Board of Directors for a period of 12 months to ensure that the institution is brought under strict regulatory supervision.
- Appointment of an Administrator
- The RBI has appointed Shreekant, former Chief General Manager of the State Bank of India (SBI), as the Administrator to oversee the bank’s operations.
Formation of a Committee of Advisors
To assist Shreekant in stabilizing the bank’s financial situation, the RBI has constituted a Committee of Advisors comprising:
- Ravindra Sapra Former General Manager of the State Bank of India (SBI)
- Abhijeet Deshmukh Chartered Accountant, specializing in financial oversight and governance
The Committee will play a crucial role in ensuring financial discipline, reviewing internal processes, and rebuilding depositor confidence.
Impact on Customers and Depositors
With RBI-imposed restrictions in place, customers of New India Co-operative Bank may face difficulties in accessing their deposits, conducting transactions, or applying for new financial products. The central bank’s measures aim to prevent further financial erosion while investigations continue.
For depositors, this situation underscores the importance of due diligence and regulatory oversight in banking operations. The RBI’s swift intervention reflects its commitment to safeguarding customer interests and ensuring financial stability.
Legal and Financial Implications
The ₹122 crore fraud case against Hitesh Mehta is among the most significant financial crimes involving co-operative banks in recent years. Given the involvement of high-ranking officials, legal experts suggest that the case could lead to:
- Stricter regulatory oversight on co-operative banks
- Potential legal consequences for Mehta and any accomplices
- Forensic audits and further investigations into the bank’s financial records
- Possible asset recovery measures to compensate for the lost funds
The Economic Offences Wing (EOW) is expected to investigate potential money laundering trails, offshore fund transfers, and any unauthorized transactions carried out during Mehta’s tenure.
