Pvt bank loses 11.2 cr to loan fraud by edu trust running engg college
Times of India | 2 January 2026
Kolkata: A reputable private bank has lodged a police complaint, claiming a loan fraud of Rs 11.2 crore involving an education trust, mentioning three trustees, that reportedly runs an engineering college in Hooghly.
The bank claimed the collateral documents submitted for credit facilities were forged and that the same property was mortgaged earlier to another financier. The complaint states the facilities were secured by three collateral properties, including the educational institute's property in the trust's name and two residential properties in the name of one trustee.
The detective department started a probe after an FIR was registered at the Shakespeare Sarani PS on Dec 31. It was submitted to the JCP (crime) at Lalbazar by an assistant vice-president of the bank's structured asset group (SAG-East) office in Kolkata, alleging criminal conspiracy, cheating, forgery and use of forged documents in connection to three loan accounts. "The accused entered into a criminal conspiracy and approached the bank to obtain a loan by presenting forged and fabricated deeds of properties as genuine. Later, it was revealed the accused produced forged deeds, stopped all payments and converted the loan amount to their own wrongful gain, causing a loss of Rs 11.2 crore to the complainant bank," claimed a DCP.
The lender sanctioned credit facilities aggregating Rs 12 crore in Feb 2022, comprising an overdraft of Rs 2 crore and a term loan of Rs 10 crore, followed by another term loan of Rs 3.4 crore in Oct 2022 for the education trust. The loans were stated to be taken for repayment of unsecured borrowings and reimbursement of expenses.
The bank claimed the borrower's operations showed low activity from March 2023 and that account irregularities began in July 2024. The accounts were classified as non-performing on Oct 29, 2024. A loan recall notice was issued on March 24, 2025, and a demand notice on May 26, 2025. The lender filed an application before the Debt Recovery Tribunal in Kolkata on July 31, 2025.
The lender said the account was classified as a Red Flag Account on June 3, 2025 after it received a representation from a third party's team, enclosing documents that referred to a legal notice and an e-auction sale notice for the property. The representation said the borrower and a trustee earlier got credit facilities from another lender by mortgaging the same property, and the exposure and dispute were not disclosed while taking the later loans.
A forensic audit was started on July 3, 2025 for April 1, 2021 to June 30, 2025. The final report, submitted on Nov 1, 2025, recorded non-cooperation by the borrower, lack of access to books of account, and inability to verify if assets were created from the term loans. The complaint said a fresh title search report received on Oct 14, 2025 and Oct 24, 2025 concluded the title deeds submitted differed from those on record with the registrar, rendering the mortgage invalid. No response was received from a show-cause notice.