PMC Bank Scam: Mumbai police notifies depositors to not protest at RBI on 1-yr anniversary

Ahead of the 1-year mark since RBI put PMC bank under moratorium approaching, Mumbai police on Saturday, issued notices to several PMC depositors advising them to not gather outside the Central Bank's Fort premises in protest. Reminding depositors of section 144 (no gathering more than 4-5 people) imposed in the city due to rise in Coronavirus (COVID-19) cases, police stated that if depositors gathered outside RBI premises, the police would be forced to arrest them. The police also highlighted the danger of wise-spread of the virus in Mumbai, affecting the depositors themselves, if they went ahead with the protest.

PMC Bank scam: ED attaches HDIL promoter Rakesh Wadhawan's 3 hotels worth Rs 100 cr

ED attaches Wadhawan's Rs 100 cr assets

On Friday, Enforcement Directorate (ED) attached three hotels owned by Rakesh Wadhawan in connection to the case. As per the press release, three Delhi-based hotels - Hotel Conclave Boutique, Hotel Conclave Executive, Hotel Conclave Comfort (FAB Hotels) owned by Wadhawan and others amounting to Rs 100 crores, have been attached. Currently, Wadhawan along with son - Sarang is in jail after being denied bail in the case, by a Mumbai court inspite of being infected by Coronavirus (COVID-19). Sarang has also been arrested in connection with a Rs 1,034-crore scam in the redevelopment of the Goregaon Patra Chawl redevelopment project.

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PMC Bank Scam

On September 21, the RBI took control of the government-run Punjab and Maharashtra Cooperative (PMC) Bank bank for six-months capping withdrawals at ₹1,000 per account and disallowing the bank to make any fresh loans for six months. Amid several depositors protesting in front of the government and the RBI, the withdrawal limit has been increased to Rs. 40,000. Moreover, the Supreme Court has also stayed the Bombay High Court order directing sale of bankrupt HDIL to ensure repayment of dues and refused to the RBI-sanctioned limits on withdrawal. RBI has extended the moratorium till December  2020 limiting withdrawals to Rs 1 lakh.

After the takeover, PMC Bank had admitted that one large account-Housing Development and Infrastructure Ltd (HDIL) was the sole reason for the present crisis. Following this, the HDIL directors Sarang Wadhawan and Rakesh Kumar Wadhawan were arrested by the Mumbai Police's Economic Offences Wing and the ED in connection with a fraud of over Rs 4,355 crores. PMC Bank officials gave loans to HDIL between the year 2008 and August 2019 despite not paying the previous loans. Seven depositors' deaths have occurred due to insufficient cash since then. 

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PMC Bank, which had Rs. 11,500 crore deposited in its 137 branches, has already depleted to Rs 200 crores as Tax officials have asked to pay TDS. Meanwhile, the Lok Sabha has passed an amendment to the Banking Regulation Act to bring cooperative banks under the supervision of the RBI. The Banking Regulation (Amendment) Bill, 2020 aims to strengthen cooperative banks by increasing professionalism, enabling access to capital, improving governance - after the PMC Bank fraud. Rakesh Wadhawan's nephews Kapil and Dheeraj Wadhawan - promotors of DHFL, are embroiled in the Yes Bank scam. 

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