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The Reserve Bank of India (RBI) has imposed severe restrictions on New India Cooperative Bank, barring customers from withdrawing any funds and prohibiting the issuance of new loans. However, the bank is still permitted to recover outstanding loans. As soon as the news broke, anxious depositors gathered outside several branches, seeking clarity on their funds.
₹122 Crore Scam Uncovered
In a shocking development, an alleged scam of ₹122 crore has surfaced, leading to an FIR against the bank's General Manager and Head of Accounts, Hitesh Mehta. The complaint was filed by Acting CEO Devarshi Ghosh, prompting Mumbai Police to take action.
Allegations Against Hitesh Mehta
Mehta has been accused of criminal breach of trust and alleged manipulation of the bank's reserve funds at its Prabhadevi and Goregaon branches. The FIR has been registered under Sections 316(5) and 61(2) of the Indian Justice Code 2023.
Mumbai Police to Investigate
The case has now been transferred to the Economic Offenses Wing (EOW) of Mumbai Police, which will lead the investigation. Meanwhile, the RBI continues to enforce strict financial restrictions on the bank. While withdrawals and loans remain banned, there are no restrictions on deposits into the bank.
What Happens to Account Holders?
As of March 2024, New India Cooperative Bank had total deposits of ₹2,436 crore. Account holders are eligible to claim insurance up to ₹5 lakh under the Deposit Insurance Scheme. The bank has urged depositors to submit their claims for processing.
Why Did RBI Take Action?
The RBI’s move was primarily driven by concerns over the bank’s liquidity position. To safeguard depositor interests, the central bank prohibited withdrawals from savings, current, and other deposit accounts. The restrictions aim to prevent further financial instability within the cooperative bank.
Bank Branches Across Multiple Locations
New India Cooperative Bank operates in several key locations, including:
- Mumbai: Andheri, Bandra, Borivali, Chembur, Ghatkopar, Girgaon, Goregaon, Nariman Point, Kandivali, Malad, Mulund, Santacruz, and Versova
- Other Cities: Navi Mumbai, Thane, Palghar, Pune, and Surat
With depositors in distress and a major financial fraud under investigation, the situation remains tense. Further updates are expected as the probe unfolds.
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