PMC Bank Scam: ED Chargesheet and Forensic Audit Reveal Systematic Fraud and Shocking Irregularities

In a major revelation in the Punjab and Maharashtra Co-operative (PMC) Bank scam, the Enforcement Directorate (ED) chargesheet and a forensic audit by Grant Thornton have exposed a deep-rooted conspiracy to hide the bank’s deteriorating financial condition. The investigation found that senior bank officials systematically violated banking norms by deliberately avoiding the classification of several defaulting accounts as Non-Performing Assets (NPAs) and manipulated financial records to present a false image of profitability.

The ED chargesheet highlights that interest payments on several loan accounts had remained pending for over two quarters but were not declared NPAs until an RBI audit uncovered the discrepancies. Shockingly, accounts like that of Abchal Ship Wreckers Limited, which became NPA in 1998, and Friends Engineering Corporation, which defaulted in 2002, were concealed from regulatory reporting until 2019. Similar irregularities were found with dozens of accounts, exposing a deliberate attempt to mislead regulators and depositors.

The Grant Thornton forensic report further revealed that 41 loan accounts linked to HDIL and its associates, despite being overdue by more than 90 days, were not classified as NPAs. Instead, the bank falsely showed outstanding interest of ₹3271.84 crore as income, against RBI regulations. The auditors found that PMC Bank consistently inflated its revenue figures over five years, hiding its true financial status from stakeholders. Notably, crores of rupees were wrongly booked as income across multiple financial years.

The systematic cover-up by PMC Bank’s management not only defrauded lakhs of depositors but also delivered a major blow to trust in India’s cooperative banking sector. These revelations have intensified demands for strict action against those responsible for orchestrating the scam and underscored the urgent need for stronger financial oversight.