Bribes-for-loans: 8 accused to appear in court today

29 Nov 2010

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Eight financial executives will appear at a special court hearing today as part of an investigation into bribes and improper loan disbursements at the nation's largest insurance company and some state-owned banks.

The Central Bureau of Investigation (CBI) is looking into bad loan write-offs by some banks and financial institutions involved in what has become known as the bribes-for-loans scandal, in which the CBI arrested the eight executives.

Two of the banks invloved, Punjab National Bank and Bank of India, have reportedly written off about Rs400 crore in the first three months of this fiscal year.

Those arrested include senior officials at Central Bank of India, Punjab National Bank and Bank of India, all state-run. A majority of the bad debt write-offs include defaults on loans extended to the real estate sector.

The CBI will bring LIC Housing Finance Ltd chief executive Officer Ramachandran R Nair and seven other bank and brokerage officials to the court in Mumbai at 2:30 pm, Anjani Kumar Singh, a lawyer representing one of the accused, said late last week.

India was ranked 87th out of 178 countries in Transparency International's 2010 Corruption Perceptions Index, scoring the same as Albania, Liberia and Jamaica. China was rated less corrupt in 78th place.

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