Five held for cheating banks

Central Crime Branch (CCB) sleuths unearthed a Rs 20-crore cheating case, causing heavy losses to leading banks, by arresting five persons.


Anup Justin (37) of Anandnagar, L Sridhar (42) of Yelahanka New Town, Srinath (33) of Nagarbhavi, Prakash (51) of Basaveshwarnagar and Sudhakar (44) of Kurubarahalli are the arrested.

The suspects prepared fake documents pertaining to a site, availed loan, produced a Kannada film, Aakasha Gange and absconded after they realised they ran into rough weather, the police said.

They prepared fake documents during 2006-07 showing Yashodhamma sold a BDA site at BSK third stage measuring 63X40 to them. They also got it registered in their names at Basavanagudi sub-registrar office.

They produced the registered documents with SBI in Girinagar, Federal Bank in Rajajinagar, UCO Bank in Malleswaram, Vijaya Bank in Pulikeshinagar and HDFC Bank in Cubbon Park and availed loans to the tune of Rs 20 crore.

Real story

In reality, Muralidhar had bought the site for Rs 10 lakh on August 26, 2002 from M R Prema and got it registered at Basavanagudi sub-registrar’s office.

Prema was the general power of attorney holder of Santosh Kumari who was the BDA allottee in the case.

Allotment letter, possession certificate, khata, sale deed, tax paid receipt and other documents are in Santosh Kumari’s name.

The complaint Muralidhar had pledged all documents with Ashoknagar Cooperative Bank on March 2, 2006 and availed Rs 30 lakh loan. He started regularly paying the installment for the loan availed.

In September this year, he again applied for a loan to construct a house in the site. The bank officials asked him to produce encumbrance certificate and tax paid receipts of the site. He obtained the records from the Basavanagudi sub-registrar’s office on September 27, 2010.

But, the records stated that Yashodhamma had sold the site to four different persons. On finding this, Muralidhar lodged a complaint with the Girinagar police. The case was handed over to the CCB.

Read more »

Business correspondents to provide door step banking in Himachal

With the objective of providing banking facilities at the doorstep, banks in Himachal have identified larger villages where the banking facilities available are at quiet a distance and directions have been issued to appoint business correspondents for meeting the daily banking needs of the residents.

Bankers who met for a special meet of the State Level Bankers Committee (SLBC) here, also reviewed the progress made under the Annual Credit Plan (2010-11) during the first quarter ending June, 2010.

Convener of the SLBC, Ripan Murgai, general manager UCO bank that with the object of providing banking at the doorstep, 48 villages with a population of over 2000 have been identified in 8 districts where the available banking outlet is at a distance.

Banks servicing the area have been asked to appoint business correspondents by June 2011 for meeting the regular banking requirements in these villages, he said.

Murgai also disclosed that UCO bank had a plan to 40 ATMs by March, 2011 and would be opening 8 of them by Diwali itself.

Speaking about the total financial inclusion plan, Jasbir Singh, regional director Reserve Bank of India, said that it would take a while for biometric UID systems to be integrated with the banking process, but the banks in Himachal have been asked to continuously review the achievements made under total financial inclusion of having covered each household with a credit facility.

Where ever loans to more than one member of the family could be extended, it should be considered, he said.

For ensuring inclusive growth, use of appointing business correspondents for handling payments under the electronic benefit transfer system needs to done in unbanked areas or where banks are at a distance, he added.

While reviewing the Annual Credit Plan, the meet was informed that against a quarterly loan target of Rs 1300.98 Cr banks had extended fresh loans amounting to 1620.39 Cr in the first quarter.

At the same time deposits grew by 18 % over the previous year and have reached a level of Rs 34650.30 crore.

The credit deposit (CD) ratio stood at 71.45 %, a significant growth on account of flow of credit from outside the state in Industrial projects and SME sector, said Murgai.

Read more »

IIFCL to guarantee infra cos' bond issues under new offering

State-run India Infrastructure Finance Company (IIFCL) has said it will soon launch, in association with the ADB, a product to improve credit worthiness of infrastructure firms that seek to raise money through long-term bonds.

"We are expecting government approval for launching a credit enhancement product within the next 10 days," IIFCL Chairman and Managing Director S K Goel said here.

Read more »

VRL Logistics Files DRHP With SEBI

Hubli-based VRL Logistics Ltd has filed DRHP to raise fund through IPO and plans to issue 2.35 Cr shares which constitutes 25% of the fully diluted post-issue paid-up share capital.

The company will utilise the IPO proceeds to fund new vehicle acquisitions (Rs.140 Cr), to retire debt to UCO Bank and Union Bank of India (to both Rs.110 Cr) and for other general corporate purposes.

SBI Capital markets is the sole book running lead manager to the issue.

Transaction Reference: SEBI

Read more »

10 times you should NOT use your credit card

It's a world of plastic money. With the swipe of a card, you could shop and dine at the best places or even plan a holiday. But plastic money does not always bring cheer to all. Spenders are often burdened with high bills and accumulated charges.

Here InvestmentYogi explains 10 occasions when credit card usage should be restricted, to avoid the vicious circle of debt.

1. Cash advance for emergencies
Do not use your credit card for cash advances. It sure is convenient to withdraw that readily available cash through your credit card from an ATM or bank, but be aware; the interest charged is around 2.85 per cent per month. With interest being compounded monthly, the effective annual interest rate thus works out to a whopping 38 per cent. The interest on the advanced amount starts accumulating from day one. Also, a flat transaction charge of 2.5 to 3 per cent of the amount withdrawn is levied.

2. Credit card for every-day expenses
Avoid using your credit card as a substitute for cash. When making daily purchases like groceries, food or household requirements, it is better to use cash rather than your card, to prevent overspending.

The convenience of a card over cash does exist but it is equally important to stick to your monthly budget. Try using your debit card instead.

3. While travelling abroad
Restrict your card usage abroad to necessities, such as hotel bill settlement etc. Credit card transactions abroad carry a 3 per cent charge on foreign currency transactions. Further, any ATM cash withdrawal attracts approximately Rs 150 plus service tax, as charges.

International credit cards are billed at the rate of exchange prevailing on the date of purchase. Try opting for a prepaid currency card instead which could work out more cost effective, as the exchange rate applied is as on the date the card has been loaded.

4. Shopping for the sake of reward points
Credit card marketers generally lure buyers with reward points and great deals. Do not use your credit card for the sake of just accumulating reward points as most likely, you would end up with not just high reward points but also a large credit card bill to settle.

5. When you will be unable to pay-up before due date
Banks have an interest-free period of 20-50 days. Avoid using your card, if you are not capable of repaying within this period. For credit card defaults, banks charge a late payment fee between Rs 250 to Rs 600 and an interest of 2.5 per cent to 3 per cent on the outstanding amount, from the date of transaction and not from the due date.

In case, the minimum amount is paid, an interest of around 5 per cent is charged on the remaining outstanding balance.

6. When you will exceed your credit limit
Do not use your credit card if you are close to exceeding your credit limit. Credit limit is the maximum credit card spending allowed by banks. However, at their discretion, many banks permit spending over the original credit limit, at an additional charge of 2.5 per cent of the overdrawn amount.

By restricting spending to 40 per cent of credit limit, it is beneficial not only for one's overall credit score, but it also brings with it an easier bill to manage.

7. Online shopping at unsecure sites
Professional hackers have malicious intentions of decrypting passwords and credit card information. Do not use your credit card for online shopping if the website is not secure or is unknown.

Look for 'Verified by VeriSign' or similar signs to confirm safety of site before keying in sensitive credit card details. Secure sites are denoted with 'https' in the address instead of the usual 'http'.

8. Billing dates of multiple cards
If you have multiple credit cards, do not use the card closer to the billing date but instead spend on the card that still has days left for the billing date. This will ensure you receive a maximum interest free credit period, of around 20 days to pay the bill, after the statement has been generated.

9. Impulsive shopping during discount sales
Discount sales at shopping malls definitely are attractive. However, it pays to make wise decisions before making those purchases with your credit card. Do not spend beyond your repayment capacity and affordability. Differentiate between wants and needs, and exercise responsible usage of your card.

10. Living a borrowed lifestyle
Do not use your credit card to buy things that you can otherwise not afford. It pays to maintain a household budget and stick to it, when spending on your credit card. Piling on unaffordable purchases is one of the quickest ways to end up in long-term debt.

A penny saved is a penny earned
So goes the wise old saying. In today's times, credit cards have become a necessary evil. Various service agencies such as airlines and hotels seek credit cards for their transactions. One must thus learn to use them properly by maximising free interest periods, avoiding overspending and accumulating dues.

With a little discipline, one can avail the benefits of not carrying large amounts of cash in one's wallet and make credit cards a great convenience.

Read more »