Bangalore: Citibank is under constant speculation for its fraudster employee who was successful in duping people for false investments. The fraud came to light when officials accidentally discovered a discrepancy in the bank’s balance sheets.
Sivraj Puri, a Bachelor in Arts from Leeds University, UK, joined Citibank eight years ago. The mastermind and trickster behind the multi-crore scam was the Relationship Manager at Citibank, Gurgoan. Taking advantage of the authority that was delegated to him and the experience he had in banking, he was able to track high profile clients and convinced them in investing in bank products that promised high returns. Puri targeted high net worth individuals (HNI’s) who were looking to invest their money in mutual funds or fixed deposits. He would then explain them about the scheme where their savings were invested in stock market for a 90 day period and promised a 2 percent monthly return. He also assured investors that the return on investment would be nearly 18 percent more than what they had invested.
Puri, displayed a certificates, which stated that he was authorized to carry out the bank’s investment schemes. He even showed that SEBI had approved the scheme. Giving no reasons to doubt him, Puri successfully got the clients to invest in the scheme.
While rich investors were doing multiple calculations of their returns, Puri was in the phase two of his plan. After getting the authorization from his customers, to use the funds in his account to invest in the stock market, Puri would divert the funds from his account to his family’s accounts and then put all the funds into the stock market through various brokerage firms, including the brokerage firm owned by his father, Normans Martin Brokers Private Limited.
According to Central Bureau of Investigation (CBI) who took up the case after Citibank lodged a complaint with the police, found that there were about 19 accounts to which the funds were routed to. And out of the 19 accounts, 8 were of the brokerage firm that Puri’s father owned. Norman Martin Brokers and Metcam Holdings were the two companies holding the accounts.Citibank froze all the accounts and the bank submitted a document which stated that about 5.21 crore of funds was deposited in the respective accounts till December 28th. All the accounts were in the names of Puri’s relatives including his maternal grandparents.
The first account was opened in September 2009 and money has been floating ever since then. The Scam is estimated to be about 400 crore. Adding to this is the discovery of Hero Honda’s Vice-President Sanjay Gupta’s involvement in the scam. Sanjay is accused of receiving commission from Shivraj Puri for the investments.
Gupta being the treasury of Hero Honda saw the opportunity to impress his boss and accepted the proposal. Gupta took the proposal to Hero Corporate Service Chairman Sunil Kant Munjal. Puri impressed Munjal by taking up big names like Vikram Pandit who was trying to change the face of Citibank and also mentioned a newsprint importer who had also invested a huge junk.
Gupta opened two accounts in the name of BG Finances and G2S Management Consultant in Axis Bank in which about Rs 4-5 crore of the Rs 20 crore commission allegedly received from Puri were still lying in these two accounts. The two have been arrested under various sections of IPC for cheating, forgery and criminal conspiracy.
Last week, Brijmohan Lal Munjal-led Hero Group had admitted that its exposure to the fraud was to the tune of Rs 28.75 crore. When the fraud came to light, Puri was ready to payback and the matter was to be resolved but maybe due to the pressure from the Citi’s global headquarters or the branch realizsed that resolving the fraud was not enough, they opted to go to the police.
Source : www.siliconindia.com