The Central Bureau of Investigation of India conducted a raid on the top financial institutions of India and arrested many of their top ranking executives. The executives were arrested on charges of taking bribes from large corporate houses for granting loans to them. The CEO of LIC Housing Finance has been arrested in Mumbai on charges of corruption.
Among other senior executives who have been arrested includes General Manager of Bank of India, General Manager of Central Bank of India and Deputy General Manager of Punjab National Bank.
These were the loans given to builders without any proper documentation and most of these loans were granted by taking undue favors from the people of the corporate houses. Another private firm MoneyMatters is also being investigated as they were involved in making out the deals between these public financial institutions and the corporate.
Raids were conducted in the LIC Housing Finance offices in Delhi, Mumbai, Jaipur, Kolkata and Chennai. Going through the documents, CBI officials were stunned to find improper loans worth millions granted without any proper documentation. Hearing the news of the arrest of their CEO, the value of the shares of LIC Housing Finance went down by a record 18% on a single day.
Experts say that this can be considered to be the biggest loan scam of corporate India. The share prices of Banks and real estate companies have been affected most in today’s trading.