A major private bank has approached the Kolkata Police, alleging a sophisticated loan fraud amounting to a staggering Rs 11.2 crore. The complaint targets an education trust that operates an engineering college in the Hooghly district, accusing its trustees of conspiracy, cheating, and forgery.
The Anatomy of the Alleged Fraud
The bank's structured asset group office in Kolkata lodged a formal First Information Report (FIR) at the Shakespeare Sarani police station on December 31. The complaint, now under the scrutiny of the detective department, outlines a detailed scheme. According to the bank, the accused trustees presented forged property deeds as collateral to secure substantial credit facilities.
Initially, in February 2022, the bank sanctioned facilities totalling Rs 12 crore. This included an overdraft of Rs 2 crore and a term loan of Rs 10 crore. Later, in October 2022, an additional term loan of Rs 3.4 crore was approved for the trust. The stated purpose was for repaying unsecured borrowings and covering other expenses.
The security for these loans involved three properties: the educational institute's land held in the trust's name and two residential properties under the name of one trustee. However, a critical discovery was made later. The bank alleges that the same property had been mortgaged earlier to another financier, a fact deliberately concealed during the loan application process.
Unraveling the Scheme and Legal Repercussions
Operational red flags began appearing by March 2023, with the borrower's account showing minimal activity. By July 2024, clear irregularities emerged, leading the bank to classify the accounts as non-performing assets (NPA) on October 29, 2024. The bank initiated recovery procedures, issuing a loan recall notice on March 24, 2025, and a formal demand notice on May 26, 2025.
The situation escalated when the bank received a representation from a third party in mid-2025, which included documents referencing a legal notice and an e-auction sale notice for the mortgaged property. This prompted the bank to classify the account as a Red Flag Account on June 3, 2025. A comprehensive forensic audit was launched for the period from April 1, 2021, to June 30, 2025.
The final audit report, submitted on November 1, 2025, highlighted significant obstacles, including non-cooperation from the borrower and lack of access to account books. Crucially, fresh title search reports from October 14 and 24, 2025, concluded that the submitted title deeds differed from the official records at the registrar's office, effectively rendering the mortgage invalid.
Ongoing Investigation and Recovery Efforts
Deputy Commissioner of Police provided a clear summary of the alleged crime, stating the accused conspired to obtain loans using fabricated documents, stopped all repayments, and converted the funds for personal wrongful gain, causing the massive loss to the bank.
Parallel to the police probe, the bank has activated legal channels for recovery. It filed an application before the Debt Recovery Tribunal (DRT) in Kolkata on July 31, 2025. Despite a show-cause notice being issued, the bank has reportedly received no response from the accused trustees.
The Kolkata Police's investigation continues, focusing on the charges of criminal conspiracy, cheating, and the forgery and use of forged documents. This case underscores the critical importance of stringent due diligence in high-value lending, especially involving institutional borrowers.
