All you want to know about Bank of Baroda's black money case

After arrests of Bank of Baroda employees - assistant general manager S. K. Garg and forex division head Jainish Dubey - along with a HDFC Bank staffer, the case is said to be only a tip of the iceberg. Here is what the suspected black money foreign exchange transfer case is all about.

What is the alleged black money case?

 

• Between August 1, 2014 and August 12, 2015 a total of Rs 6,172 crore was illegally remitted to some companies in Hong Kong from Bank of Baroda's Ashok Vihar branch in New Delhi.
• The remittance was for import of dry fruits, rice and pulses but allegedly there were no actual imports.
• The money was remitted by 59 companies through their newly-opened current accounts at the bank's Ashok Vihar branch. The branch opened 59 current accounts from May 2014 to June 2015 through which large foreign exchange remittances were made. CBI sources said these remittances were sent by splitting them into smaller amounts to avoid automatic detection by software used by banks to alert them about such transactions.
• The case came to light after the bank complained about the unusual remittances that were discovered during an audit of its accounts.
• Last week, CBI and the Enforcement Directorate started investigating the matter. They raided quite a few branches of Bank of Baroda and residences of bank's assistant general manager S.K. Garg and Jainish Dubey, head of the foreign exchange division its Ashok Vihar branch.
• On October 12 as many as six persons, including Garg and Dubey were arrested on charges of criminal conspiracy, cheating and provisions of the Prevention of Corruption Act. The other four arrested, include Kamal Kalra, working with the foreign exchange division of HDFC bank, Chandan Bhatia, Gurucharan Singh Dhawan and Sanjay Aggarwal.
• Bank of Baroda said 90 per cent of the Rs 6,172 crore came from 30 other banks, while only 10 per cent was received as cash at the its branch in New Delhi. After the arrest of the HDFC Bank employee, the probe in the case is set to widen and is said to be only the tip of the iceberg.
• The Finance Minister has said that he wants the Bank of Baroda case to be fast-tracked as only after the completion of the probe can the magnitude and exact amount of the alleged black money transfer can be known.

Recent appointments at Bank of Baroda:

 

 

1. P S Jayakumar, former Citibank executive, on October 12 took over as the managing director and chief executive officer of Bank of Baroda at a time when the public sector bank is struggling for an image-makeover as CBI probes into the suspected Rs 6,100 crore black money foreign exchange transfer case.
2. Former Chairman of Microsoft India Ravi Venkatesan has taken over as the Chairman of Bank of Baroda.

The appointment of Jayakumar and Venkatesan comes as a government policy to overhaul public sector banks by bringing in private sector executives.

 

The bank leadership post had remained vacant for as many as 15 months after its Chairman S S Mundra moved to take over as the RBI Deputy Governor last year. Ranjan Dhawan, who was the MD & CEO-in-charge after Mundra, had retired on September 30.