A special CBI court in Mumbai this week sentenced seven people, including a bank officer, to three years’ imprisonment for a financial fraud involving a sophisticated modus operandi, dating back to 2010. The court found proof that the men were involved in a fraud amounting to Rs 8.64 crore, where they intercepted couriers sent by the State Bank of India (SBI) for physical verification and posed as bank staff on phone calls to avoid detection.

The men — Rajendra Shelke, Ramesh Tiwari, Satish Pujari, Akhilesh Pandey, Padmakar Chavan, Anoop Roy, and Nitin Kakade — were found guilty under various sections, including cheating and forgery.

The court suspended their sentence to allow them to file an appeal. One person was acquitted.

The modus operandi

In May 2010, an SBI assistant manager filed a complaint with the CBI over an alleged fraud at the Punjab National Bank’s Solapur branch. The SBI branch had received two Letters of Credit and related documents from a firm, said to have been issued by the Solapur branch of PNB. The SBI conducted verification of the same. First, a courier was sent to the branch for physical verification, which was received by an “officer,” and then phone calls were also made to the bank. Suspecting something amiss as the firm did not have the requisite turnover proportionate to the bills submitted for the credit, the SBI officials again made phone calls to the PNB branch, this time to the branch manager, who confirmed that no such letters of credit were issued.

The inquiry into the fraud revealed that a broking firm had submitted inland bills for discounting under five Letters of Credit between 2009 and 2010. The LCs were said to have been issued by PNB Solapur. Before discounting the bills, details were confirmed from the PNB branch telephonically. The firm’s numbers were verified through the BSNL directory. Relevant documents were dispatched through a courier to the branch, apart from fax confirmations.

Phone calls and couriers intercepted 

The CBI said that Ramesh Tiwari, a senior manager at PNB, Solapur, had given access to his private cabin to a co-accused, a recovery agent, during the relevant period. This was used to receive the two phone calls for verification from the SBI. The agent posed as ‘Pandey’, a bank officer, although no such staffer by that name worked at the branch. The accused also posed as bank officials to receive couriers received from SBI for verification.

“It appeared that the fraudsters’ access to the telephone number of PNB, Solapur, and the act of the courier agency in making unauthorized delivery of documents had facilitated the fraud,” the CBI submitted to the court. The firms named were shell entities.

During the trial, the CBI brought before the court witnesses, including printer shop employees and owners, graphic designers, and others sought by the accused to prepare over 500 forged letterheads of the bank for the fraudulent activities. The accused had claimed multiple irregularities in the probe. The court, however, said there was sufficient evidence to convict the accused.