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Hyderabad: CBI court sentences two former Union Bank of India officials to 5 years RI for fraud

Late Koteswara Rao, proprietor of a company, had conspired with the 2 officials to sanction 23 loans for construction of independent houses.

BySouth First Desk

Published Jun 28, 2023 | 7:03 PM ⚊UpdatedJun 28, 2023 | 7:03 PM

A chargesheet was filed on 18 May 2007 against three accused in the bank fraud case. (Creative Commons)

Bank fraud (Creative Commons)

A Special Judge for CBI cases in Hyderabad has sentenced former Branch Manager of Union Bank of India Pillendla Phani Prasad and former Assistant Bank Manager Chintakuntla Pandurangam Chalapathi to five years of rigorous imprisonment (RI) with a fine of ₹75,000 each in a bank fraud case.

The CBI had registered a case on 30 November 2005 against Prasad and Chalapathi — both working in the Asif Nagar branch of Union Bank of India, Hyderabad — and Yerram Koteswara Rao, proprietor of a private company, based on allegations that the proprietor had conspired with the public servants to sanction loans to 23 group housing loans for construction of independent houses.

Additionally, he disbursed ₹1.15 crore without proper identification of the borrowers and on false documents.

Also Read: ED arrests Deccan Chronicle promoter in bank fraud case

Union Bank of India suffered loss

The loan amount sanctioned was withdrawn by the proprietor and part of the money was diverted for purposes other than for which the loans were sanctioned. Some of the houses were not fully constructed and some were not constructed at all.

It was further alleged that the proprietor had earlier received the amount from other borrowers who had availed loans from Andhra Bank for the same properties.

All the accounts had become non-performing assets (NPAs). A loss of ₹1.15 crore was caused to Union Bank of India.

Also Read: Court sentences bank official, businessmen to 5 years RI for fraud

History of the case

Searches were conducted on 14 December, 2005, at the premises of the accused. During the investigation, Koteswara Rao, the proprietor, was arrested.

After the investigation, a chargesheet was filed on 18 May, 2007, against the three accused. During the trial, Koteswara Rao passed away. The trial court found the other two accused guilty and convicted them.