Full Coverage: Loan Scam
PSU bank officers, including LIC Hsg Fin CEO, were accused of taking bribes to sanction loans.
Observing that Rajesh Sharma, chairman and managing director of city-based firm Money Matters, seemed to be the "kingpin" in the multi-crore kickbacks-for-loans scam, the Bombay High Court today rejected his bail plea. Housing loan scam has indicated many top real estate companies got loans in a fraudulent manner. Probing into the kickbacks-for-loans scam, the CBI claimed that private realty companies were aware of the fraudulent measures. LIC Housing Finance, which is in the eye of the loan scam, on Monday said that outstanding loans to the tune of Rs 389 crore are under the scrutiny of the Central Bureau of Investigation Tax dept will take a close look at expense accounts of Emaar MGF, Parsvnath, DLF and others. Housing loan scam has not led to any order being issued to lenders, says govt. The CBI said the cross-country housing loan racket can be called a case of bribery and corruption. The official said that no instruction has been issued to banks to reduce their exposure to realtors. Three firms, including BGR Energy Systems Ltd and Oberoi Realty, denied their involvement in the housing loan scam. Jaiprakash Power Chairman said, the company has received a notice and is complying with the probe. Shares in Unitech fell as much as 26.8 per cent to Rs 46.1, its lowest since May 2009. Parsvnath fell 20 pct after reports suggested that the Govt will widen probe into the scam. HDFC's Deepak Parekh says property prices may fall as a result of the housing loan scam. Sebi suspects the unscrupulous activities to have begun in these companies at least a year ago. The recent housing loan scam may end up deflating Mumbaiís overheated property market; realty analysts predict an imminent drop between 15 and 30 per cent. RN Bhardwaj, former chairman of LIC and LIC Housing Finance, told The Indian Express that an emergency board meeting has been called tomorrow. A day after the loan scam broke out, Life Insurance Corporation (LIC) on Thursday moved swiftly to appoint VK Sharama. Five of the Indian companies involved in the housing loan racket borrowed Rs 1,000 crore by bribing bank officials, news agencies reported on Thursday quoting two private TV channels. Finance Minister Pranab Mukherjee directed all public sector banks to review their exposure to companies mentioned in a CBI investigation.