Punjab & Sind Bank reports about `238 crore fraud by Bhushan Power

New Delhi: State-owned Punjab & Sind Bank Wednesday reported over Rs 238 crore fraud by Bhushan Power and Steel, a third such instance after similar disclosures made by PNB and Allahabad Bank recently.

"On the basis of forensic audit investigation findings and CBI filing FIR, on suo moto basis, against the company and its directors, alleging diversion of funds from banking system, a fraud of Rs 238.30 crore is being reported by bank to RBI.

"In the accounts of the company (BPSL), bank has already made provisions amounting to Rs 189.35 crore, as per prudential norms," Punjab & Sind Bank (PSB) said in a regulatory filing.

It has been observed that the company has misappropriated bank funds, manipulated books of accounts to raise funds from consortium of lender banks, it said.

"At present, the case is at NCLT which is in advance stage and the bank expects good recovery in the account," it added further.

Last week, Allahabad Bank had reported to the RBI about a fraud of Rs 1,774.82 crore by BSPL, alleging diversion of funds from banking system by the company.

"The bank has already made provisions amounting to Rs 900.20 crore against the exposure of the bank in BPSL," Allahabad Bank had said on Saturday.

Earlier, Punjab National Bank (PNB) had also reported to the RBI about a fraud worth Rs 3,805.15 crore by Bhushan Power and Steel.Around 85 per cent of PNB's Rs 4,399 crore exposureto the company had been siphoned off.

It is expected that more banks would report fraud committed by Bhushan Power and Steel as the CBI complaint registered in April named several other lenders.