After over Rs 127 cr recovery, Pkl MC puts FD reinvestment on hold

Panchkula: After recovering Rs 127.7 crore from Kotak Mahindra Bank in connection with recent financial irregularities, the municipal corporation (MC) has decided not to immediately reinvest the amount in fixed deposits (FDs). Instead, the funds have been temporarily parked in bank accounts.Sources told TOI that the decision was taken as the state govt has constituted a state-level committee to frame fresh guidelines to open FDs in banks. The committee is expected to lay down norms aimed at ensuring greater transparency and safeguards in the handling of public funds. These guidelines will likely cover procedures for selecting banks, approving deposits and monitoring transactions.Officials said the move is intended to avoid any risk until a clear policy framework is put in place. The development follows the exposure of the Rs 145 crore FD scam, after which authorities tightened financial oversight. Officials maintained that protecting public money remains the top priority and further action will be taken in line with the committee's recommendations.However, MC officials said the civic body is yet to receive the remaining Rs 19 crore, and discussions are currently underway to recover the balance amount.How the accused were exposedAccording to the MC, the illegal practice of diverting or misusing FD funds had been continuing for a long time. On earlier occasions, FDs were routinely renewed with the same bank. This time, however, the corporation chose to explore the open market and invited offers from different banks to secure best interest rates.Initially, bank representatives assured MC officials of offering even better rates than before. Despite this, the MC insisted on getting its funds back. During verification, officials found that funds were not available. Further checks revealed the existence of additional bank accounts that were not reflected in official municipal records.An officer said the accused had not anticipated that the MC would refuse to renew the FDs as it had done in the past. As a result, they were allegedly unable to manage the funds on time, leading to their exposure."So far, having recovered the funds, we are not in a hurry. The money is currently in the account, and we will proceed once the committee finalises the norms," the officer said.Six accused have been arrested in the case till now. According to the ACB, the prime accused are the MC's former senior accounts officer Vikas Kaushik and Kotak Mahindra Bank's deputy vice-president Pushpender Chaudhary. Serious irregularities were found in records related to 16 FDs worth over Rs 145 crore, with a maturity value of around Rs 158 crore. MSID:: 130192481 413 |
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