CBI's Letters Rogatory to 5 countries over KFA

CBI's Letters Rogatory to 5 countries over KFA

CBI's Letters Rogatory to 5 countries over KFA

The CBI has decided to send Letters Rogatory to five countries seeking information on remittances made by Vijay Mallya-promoted Kingfisher Airlines abroad.

This is part of CBI’s investigation into the default of Rs 900-crore loan given by IDBI. According to the CBI FIR, officials of IDBI colluded with the promoters/directors and CFO of Kingfisher Airlines and sanctioned credit limits of Rs 900 crore in violation of banking norms, thereby causing loss to the said bank by such fraudulent acts.

Sources said besides the UK and the US, CBI will be sending the judicial requests to France, Hong Kong and Switzerland after CBI’s Financial Intelligence Unit get some leads regarding the possible investment abroad using the IDBI loan.

CBI suspects that a “major chunk” of the Rs 950-crore loan taken from the IDBI Bank, which was transferred to Axis Bank, was used for foreign remittances towards lease rentals, and purchase of parts of the aircraft.

The case was registered after a preliminary enquiry into the allegations of IDBI Bank gave the loan to crisis-ridden Kingfisher Airlines by overlooking negative credit ratings and net worth.

The issue came to light after CBI arrested Syndicate Bank Chairman and Managing Director S K Jain for reportedly taking a bribe of Rs 50 lakh for increasing credit limit of some companies in violation of banking rules. According to investigators, the bank will have to explain why it extended the loan to the airlines, ignoring its own internal report that recommended against giving a loan. Kingfisher had stopped operations in October 2012.

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