What is ABG Shipyard scam, how 28 banks lost Rs 22,842 crore

What is ABG Shipyard scam, how 28 banks lost Rs 22,842 crore

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new Delhi. ABG Shipyard Scam is being told as the biggest banking scam of the country. Rishi Kamlesh Aggarwal, Chairman and MD, ABG Shipyard Limited along with some others defrauded 28 banks to the tune of Rs 22,842 crore between 2012 and 2017. As soon as the scam came to the fore, now the opposition has become an attacker on the government. This episode has also disturbed the central government. On the complaint of State Bank of India (SBI), the CBI has registered a case and started investigation.

A new challenge has arisen in front of the government due to the occurrence of this scam in Prime Minister Narendra Modi’s home state Gujarat. However, Finance Minister Nirmala Sitharaman tried to blunt the onslaught of opposition parties including Congress by saying that the loan given to ABG Shipyard had become NPA in the Congress-led UPA government itself. is of. Nirmala Sitharaman denied the allegations of delay in taking action against the accused in the scam and said that usually in such cases, action has been taken in less time than the time taken to act. The Finance Minister said that the guilty will not be spared.

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Story of ABG Shipyard reaching the floor

ABG Shipyard Limited (ABGSL) was incorporated on 15 March 1985. This shipyard company of ABG Group in Dahej and Surat, Gujarat, works in the construction and repair of water vessels. ABG Group became a big name in the country’s shipbuilding industry under the leadership of its promoter Rishi Agarwal. According to a report by India Today, the company has built around 165 water vessels in the last 16 years. Of these, 46 were exported to other countries. The company has earned class approvals from Lloyds, Bureau Veritas, American Bureau of Shipping etc. on the basis of its unmatched quality.

mess started from 2012

After the year 2021, the company started messing up. The financial condition of the company deteriorated. An examination of the forensic audit report from April 2012 to July 2017 filed by Ernst & Young LP on January 18, 2019, has revealed that the company through unlawful activities misappropriated bank loans and diverted funds. The loan received from the bank was not used for the mentioned works but for other works.

Forensic audit revealed the scam

In January 2019, the State Bank of India, with the help of Ernst & Young, conducted a forensic audit. It came to light that in the five years between April 2012 and July 2017, ABG Shipyard Limited carried out this biggest banking scam in the country. In the FIR lodged by SBI, it has been said that the audit report revealed that there has been criminal breach of trust by misusing the loans received from banks to avail illegal benefits.

According to SBI’s complaint, ABGSL transferred the money received from the bank to other concerned parties. Not only this, it was also used to repay loans and other expenses of other group companies and also for letter of credit. Sources say that the CBI suspects that the company has also transferred the amount received from the banks to the tax haven.

Complaint given to CBI on November 2019

SBI’s Fraud Identification Committee caught hold of it only in June 2019 but the first complaint was filed with the CBI in November 2019. However, SBI has said that “no attempt was made to delay the process”. .

According to this, on 8 November 2019, representatives of 28 banks had filed a complaint against ABG Shipyard for the first time in the CBI regarding this big scam. In 2020, the CBI sought some clarity regarding this complaint, after which in August 2020, the banks again sent the revised complaint to the CBI. After investigating the case for one and a half years, finally the CBI registered an FIR on 7 February 2022.

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case registered against them

CBI has registered a case against ABG Shipyard Limited, its Chairman and MD Rishi Kamlesh Agarwal and many others. These people include former executive director Santhanam Muthuswami, former director Ashwini Kumar Agarwal, Ravi Vimal Nevetia and another group company ABG International Pvt Ltd. The CBI has booked them under various sections of the IPC and the Prevention of Corruption Act on charges of criminal conspiracy, cheating, criminal breach of trust and abuse of official position. The CBI also raided the company’s offices and the residences of its directors in Bharuch, Mumbai and Pune on February 12 and 13 and recovered documents related to the scam.

Tags: banking scam, FM Nirmala Sitharaman

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