The Supreme Court perused a report submitted by a committee of four expert doctors from Mumbai’s JJ Hospital.
It was also taken into account that Mr Mulchandani has been in prison for more than a year.
The money laundering probe against Mulchandani and others, who were arrested on July 1 last year, stemmed from several FIRs registered by the Pune police on the basis of bank complaints and an audit conducted by the Registrar of Cooperative Societies. Large-scale money laundering has been reported. The “massive” fraud and misappropriation of public funds resulted in a loss of Rs 429 million to Seva Vikas Cooperative Bank and “impacted loss on thousands of small depositors”.
The bank “was run like a family business by Mr. Amar Mulchandani without following any prudent banking norms and preferential loans were sanctioned in exchange for huge kickbacks,” the ED said.
The agency said over 92% of loan accounts turned into NPAs, ultimately leading to the bank’s failure, following which the RBI revoked the bank’s license. Mulchandani and five members of his family had been arrested by the Maharashtra Police on January 27 on charges of “obstructing” the ED’s raid on the former bank president and “destroying evidence”.
Assets worth Rs 122.35 crore, including some ‘benami’ properties in Mulchandani, were also provisionally seized by the authorities earlier.
