Biz couple, bank official convicted for diverting funds

A CBI special court has convicted three people of cheating Dena Bank.

Former AGM of Dena Bank Ramesh Raghunath Kamath and Hyderabad-based businessman N Sudhakar Rao and his wife Jyotsna Kulkarni, both partners of Vaishnavi Sales Corporation, were found guilty of diverting funds for various purposes after Kamath facilitated the company to avail Rs 2-crore credit for business-related requirements.

Special court judge H A Mohan sentenced Kamath to two years’ simple imprisonment (SI) and a fine of Rs 1 lakh. Rao received three years’ SI and a fine of Rs 6 lakh, while Jyotsna was sentenced to one-year SI and a fine of Rs 75,000.

The investigation revealed that the letter of credit for Rs 4.49 crore, submitted by Rao, was forged, and not issued by UCO Bank, Burdwan Branch in West Bengal. Kamath had discounted the letter of credit without verification and credited the amount into the account of Vaishnavi Sales Corporation.

The CBI stated that Dena Bank incurred a loss of approximately Rs 7 crore since the borrowers failed to repay the due amount and the company account became Non-Performing Asset (NPA).