CID arrests SBI official in Rs 7 crore loan fraud case in East Godavari district

Rajahmundry: The crime investigation department (CID) has intensified its probe into a major loan fraud at the State Bank of India (SBI) branch in Prakkilanka village of Tallapudi mandal in East Godavari district, involving an amount of Rs 6.87 crore. According to CID officials, the fraud took place between Sep 2016 and June 2019. One borrower, Kavala Venkata Narasimham, allegedly availed 25 agricultural allied business loans (AABL) amounting to Rs 6.87 crore by misusing the KYC details of 25 other individuals, with the alleged connivance of bank officials.On Wednesday, Asma Farheen, additional superintendent of police, CID regional office, Rajahmundry, arrested Kovvasi Venkata Rao, who was working as field officer-cum-deputy manager (advances) at the SBI Prakkilanka branch at the time. He was produced before the special judge for trial of cases under the Prevention of Corruption Act in Rajahmundry and was remanded to judicial custody for two weeks. CID officials said the prime accused, Kavala Venkata Narasimham, executed the fraud in collusion with Mutnuri Uday Kiran, then manager of SBI Prakkilanka branch, and Tamilrasan Stalin Babu, manager of SBI Kovvuru Bazar branch. The two managers allegedly diverted the loan amounts to the account of Venkata Narasimham. Both branch managers were arrested last month. Meanwhile, the prime accused Venkata Narasimham is absconding, police said.The CID has registered a case under Sections 420 (cheating), 409 (criminal breach of trust) read with 120-B (criminal conspiracy) of the IPC, along with Section 13(2) of the Prevention of Corruption Act, 1988. Investigators are also examining whether the 25 individuals in whose names the loans were sanctioned were aware of the fraud or if their identities were misused without their knowledge. The investigation is ongoing.