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27 district banks emerge unscathed from gilts scam

Renni Abraham & K Ram Kumar

As many as 27 district central co-operative banks in the state have emerged unscathed in the ongoing probe into the government securities scam. The office of the commissioner of co-operatives has given them a clean chit.

The probe into the DCCBs and urban co-operative banks has so far identified the Nagpur, Osmanabad and Wardha DCCBs as the rogue banks that have indulged in government security purchases aggregating Rs 2 billion through brokers.

Additional commissioner of co-operatives BG Yashod told Business Standard: "We have completed investigating the g-sec transactions of all the 30 DCCBs. Apart from the three DCCBs, none of the 27 others have violated RBI guidelines pertaining to investments in government securities."

He added that the investigations into the 658 UCBs was still in progress. Already the Satguru Janglee Maharaj Cooperative Bank (Pune), Amravati People's Cooperative Bank and the Amravati Zilla Parishad Teachers Co-operative Bank have been found guilty in the government securities scam as they do not have physical possession of the securities for which they paid the brokers.

In another development the Chiplun Urban Co-operative Bank was cleared by the co-operative commissioner's office.

On Wednesday the bank was investigated for having indulged in g-sec transactions in the last fiscal aggregating Rs 50 million, the physical delivery of which was not received for more than six months.

However, subsequently the physical delivery of the securities was received which has saved the bank. The Chiplun bank has been asked to clarify the reasons for the delay in getting physical possession of the government securities.

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