RBI to probe Citibank fraud
01 Jan 2011
The Reserve Bank of India (RBI) has said it has initiated a probe into the Rs300 crore fraud at Citibank's Gurgaon (Delhi NCR) branch and would soon issue a statement in this regard.
Customers, including corporate entities, were duped into depositing as much as Rs300 crore in accounts set up by a Citibank bank executive under the pretext they were investing in a scheme offered by the bank.
The executive, Shivraj Puri, was interrogated for almost four hours by the Gurgaon Police on Thursday following his arrest and police sources said he reportedly confessed that his bank had no role in the episode and that he had organised the scam on his own.
On Friday, the Gurgaon police questioned the chief financial officer of Hero Group, Sanjay Gupta, and representatives of brokerage firms Religare and Bonanza in connection with the scam. The Hero Group is a leading automotive manufacturer in the country.
The Hero Group is reported to be the largest investor lured by Puri, with an exposure of Rs28.75 crore via its entities.
The money was invested with brokerage firms Religare and Bonanza.
''The destination of the money was into these two broking firms,'' said Gurgaon Commissioner of Police SS Deswal.
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