Mallya-IDBI CMD 'holiday meeting' led to sanction of Rs 350 crore loan

By : 30-Jan-2017
 Bank CMD-Mallya holiday meeting

The Enforcement Directorate said that IDBI bank released Rs 350 crore to liquor baron Mallya after a holiday meeting without looking into Kingfisher Airlines’s financial crisis.

The bank was accused of illegally extending its support by sanctioning approximately Rs 900 crore. Currently, the agency is probing the loan that bank had proceeded formalities everything intentionally and illegally that Mallya did not like to pay it back.

PMLA has been carrying out investigating and it indicates the value of collateral security offered by Ms KAL and has not been assessed. Approaches of the bank and haste have been shown while releasing loan to Mallya amounting Rs 350 crore.

“It is observed that loans have been sanctioned post meeting of Mallya with then CMD (Yogesh Aggarwal) of the bank on holiday.  Rs 150 crore has been released on October 7, 2009, and Rs 200 crore on November 4, 2009,” said the Enforcement Directorate’s (ED) report.

The CBI arrested Aggarwal and eight others in connection with the case and investigating. Although Mallya was charged in the case; he has been staying in the UK and confirmed that he is a proclaimed offender.

The reports said that substantial amounts have been released to KFA – on the ad-hoc basis without due diligence pointed to a deep-rooted criminal conspiracy between bank employees and promoters of KAL.

 “Since the next day was a holiday, it was pointed to him and he could pay a visit at a later day. However, it was said by Mallya that he was leaving for Mumbai next day evening as the matter was urgent which Aggarwal accepted to do,” the former executive of IDBI said. 

“Mallya said that Ms KAL was in financial crisis and required funds to keep his business running,” Aggarwal said in his statement.

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