Mumbai: The Enforcement Directorate has challenged the Mumbai Police’s decision to file a closure report in the Maharashtra State Cooperative (MSC) bank scam, in which 70 politicians from the state, including Nationalist Congress Party chief Sharad Pawar, Ajit Pawar, and top Congress and Shiv Sena leaders had been named as accused. The ED matter will come for hearing at a local court on October 16.
An ED official privy to the latest development, as reported in the Economic Times, said, “Under the Prevention of Money Laundering Act (PMLA), a case requires a predicate offence. ED’s MSC bank case is based on the predicate offence registered by the Mumbai Police. Since the city police has closed its case, it might have a bearing on the ED’s investigation and therefore the central agency has moved the local court with an intervention application.”
The Mumbai Police, for its part, in the closure report, had said that there was no material evidence to prosecute the accused. The case is particularly significant as it had become an election issue in Maharashtra during assembly elections in 2019. Though Ajit Pawar had been made as an accused in the FIR, his uncle Sharad Pawar was not named in the case by the city police. However, the central agency has continued to probe in the case relating to money laundering. The ED’s case under PMLA is based on the original case filed by the Mumbai Police.
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The issue of a scam and money laundering by top politicians came to light prior to the 2019 assembly elections, during the BJP-Shiv Sena government, when the Bombay high court had ordered Mumbai Police’s Economic Offences Wing to register a first information report (FIR) against those involved in the loan scam at MSC Bank. According to ED’s Enforcement Case Information Report, the scam is pegged at Rs 25,000 crore.
According to Economic Times report, the city police had closed the MSC bank case following the forensic reports, reports of the National Bank for Agriculture and Rural Development (NABARD), statements by bank officials and auditors as they have failed to point any wrongdoing and criminal misappropriation by the accused in the case.
“It’s more a case of rules being circumvented. There is no material evidence to indicate any criminal misappropriation, conflict of interest or misuse of office,” the ET report quoted an official in the know of the things from Mumbai Police.
Of the 70 politicians accused in the case, 50 are from the NCP, nine from Congress, two from Shiv Sena and one from the BJP. Currently, Maharashtra is run by a triumvirate alliance of Shiv Sena, NCP and the Congress.
MSC Bank, the apex bank that controlled credit to the co-operative sector in the state and was handled by the ruling politicians, landed in trouble in 2011 after an inquiry report by NABARD found the bank was in red with a negative of Rs 144 crore. The report indicted the board of directors of the bank for financial mismanagement that led to a ballooning of non-performing assets. This was largely due to handing out of loans to sugar co-operatives and spinning mills in violation of all norms.