The Frost International Ltd involved in the loan fraud case. The Central Bureau of Investigation (CBI) has booked a Mumbai-based company for alleged bank loan fraud to the tune of Rs 3,500 crore. On Tuesday, the agency also carried out searches at 13 locations which included the premises of the firm.
The CBI has booked Mumbai-based Frost International Ltd for allegedly cheating a consortium of 14 banks of more than Rs 3,592 crore, sources said. The Kanpur Zonal Office Bank of India filed a cbi case against the Frost International Ltd. It alleged that the directors had worked in the guise of undertaking merchanting trade without genuine business, they said.
Investigation of Frost International Ltd Case
Since, CBI conducted searches at 13 locations on Tuesday. It included premises of the company and the company officials involved.
Besides the company and its directors, the agency has booked 11 more entities which include three Kanpur-based companies — RK Builders, Globiz Exim Pvt Ltd, Nirman Pvt Ltd — represented through their directors.
These companies were corporate guarantors for Frost International, officials said. It is alleged that they had defaulted in meeting payment obligation towards the lending banks of the consortium led by BoI, the officials said, adding that Frost International and its directors, guarantors and unidentified others submitted forged documents, diverted and siphoned off the bank’s funds. The action of the firm and its directors cheated the banks of over Rs 3,592.48 crore, for fraud they added. Hence, it associated with the financial crime.
The banks had already secured look out circular (LOC) against Uday Desai and 10 others on January 18, 2019.
BoI, in its complaint which is now part of the FIR, has said that Frost International was managed by Uday Desai, Sujay Desai, Sunil Verma and Anup Kumar Baldevraj Wadhera since its inception in 1995 and was banking with the consortium since 1996 having businesses in diverse products from agro commodities to bullion.
Final Words regarding Frost International Ltd
The company had suppliers and buyers across the globe from China to the United States with its promoters well involved in international trade. BoI provided credit facility of Rs. 380.65 crore. Therefore, it raised to Rs 4,061 crore with the formation of a consortium of 14 banks in 2011.
IOB provided credit facilities to the 14 banks. It also extended exposure of Rs. 498.51 crore. The BoI complained that the company hypothetical securities market. It distributed properties as collateral for credit facilities.
