S.K. Jain favoured for appointment as Syndicate Bank CMD: CBI Director Ranjit Sinha

NEW DELHI: CBI has found that there were irregularities in the appointment of S.K. Jain as the Chairman and Managing Director (CMD) of Syndicate Bank by the UPA government last year and has submitted a report to the Union Finance Ministry.

"We have found that the appointment process was not transparent and Jain was favoured for the job. We have sent a report to the Finance Ministry to look into this," CBI Director Ranjit Sinha told ET on Tuesday. Jain, who was appointed as CMD of Syndicate Bank in July 2013 for a term of five years by the Finance Ministry in UPA tenure, was arrested last week by CBI on charges of taking bribes for extending credit limits of Bhushan Steel and Prakash Industries. CBI is also in possession of some 'explosive' phone transcripts which show other PSU banks are involved in the racket.

CBI had arrested an alleged key middlemen, Pawan Bansal, who is accused of acting as a liaison between Jain and the private companies and owns Altius Finserv, a boutique investment bank. CBI Director Ranjit Sinha told ET that the phone tap transcripts with CBI do reveal that Bansal was also in touch with other public sector banks for arranging loans for private companies. "Bansal was in touch with other PSU banks too for the purpose of loans for companies. We will look at other banks too if required. But right now, we are limiting our investigation to the two companies in question and Syndicate Bank. This is an anti-corruption probe and not a bank fraud investigation," Sinha has told ET.

The CBI's First Information Report (FIR) in the case also mentions that Bansal is in touch with heads of many PSU banks and meets these bank officials for pursuing the loan proposals prepared and processed by his firm on behalf of his clients. CBI alleges that a part of the fee paid by companies to Bansal for his services was paid as bribes to PSU banks. "But CBI will have to prove that bribes were paid to other banks as well...it is always difficult to do so at a later stage unlike the Syndicate Bank case in which the bribe was caught red-handed," a senior CBI probe official told ET.