CBI court in Chennai convicts four in Rs 4 core bank fraud case

New Delhi, Nov 22 A special CBI court in Chennai has convicted two private firms and two individuals in a bank fraud case involving more than Rs 4 crore, bringing to an end a 15-year-long trial that began after Canara Bank flagged serious irregularities in loan disbursal, an agency official said on Saturday.  

According to the CBI, the court on November 21 sentenced Afrina Steel Rolling Mills and Basheer & Co, both private firms, to pay fines of Rs 20 lakh each.

The firms were represented by their owner, Nazeer Ahmed, who has been sentenced to seven years of rigorous imprisonment along with a fine of Rs 40 lakh.

Another accused, Ashik Arafath, has been awarded one year of rigorous imprisonment and fined Rs 20,000. In total, the court has imposed fines amounting to Rs 80.2 lakh on the convicts.

The case dates back to September 2010, when the CBI registered an FIR based on a complaint by the Chief Vigilance Officer of Canara Bank.

“The allegation was that the accused private companies, M/s. Afrina Steel Rolling Mills (A-1) and M/s. Basheer and Co (A-2) were partnership firms run by Nazeer Ahmed (A-3) and his wife Fathima Riswana (A-4) and Ashik Arafath(A-6),” the CBI said in a press note.

Investigators found that the accused firms—operated by Nazeer Ahmed, his wife Fathima Rizwana, and others—entered into a criminal conspiracy with senior bank officials, including Chief Manager T. Rajendran and panel valuer K.S. Ashok, during 2007-08.

The accused allegedly misused the bank’s trust, submitted fabricated documents, and fraudulently availed loans and bank guarantees worth Rs 405.47 lakh from Canara Bank’s Kilpauk branch in Chennai.

The actions caused substantial financial loss to the bank while generating unlawful gains for the accused parties.

A chargesheet was filed in May 2012 against seven individuals. During the trial, two of them—Rajendran and Ashok—passed away, leading to the abatement of proceedings against them.

After years of hearings, the court has now convicted four accused, while Fathima Rizwana, one of the partners in the firms, has been acquitted due to lack of evidence.

The judgment marks a significant development in the prolonged investigation, reaffirming the CBI’s stance on corruption and loan fraud cases involving collusion between private entities and bank officials.

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