On June 5, the Enforcement Directorate (ED) conducted simultaneous searches at 10 locations across Delhi, Noida, Ghaziabad, and Panipat, uncovering what officials describe as a major money laundering and bank fraud case involving ₹190 crore. The case is linked to Shri Sidhdata Ispat Pvt Ltd, a steel manufacturing company engaged in cold and hot rolled steel production.
The searches reportedly targeted directors, promoters, auditors, and associates of the company accused of defrauding Bank of Baroda (formerly Dena Bank). The firm allegedly secured massive loans on the basis of false documentation and financial misrepresentation.
ED sources indicated that promoters were unreachable during the operation, fueling suspicions of possible absconding. While investigators are yet to confirm the number of people involved, documents and digital records seized during the raids are expected to uncover the larger financial web behind the fraudulent loans.
Former UCO Bank Chairman Arrested in ₹6,210 Crore Concast Steel Fraud
Just weeks before the recent raids, on May 16, the ED arrested Subodh Kumar Goel, former chairman of UCO Bank, from his residence in Delhi. His arrest is tied to a ₹6,210.72 crore loan fraud involving Concast Steel and Power Ltd. (CSPL), a Kolkata-based company.
Investigators allege that loans granted to CSPL were fraudulently diverted and siphoned off through shell entities and fictitious contracts. The FIR, originally filed by the Central Bureau of Investigation (CBI), accused company officials and bank insiders of conspiracy, diversion of sanctioned funds, and misuse of credit facilities.
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This arrest, combined with the ED’s expanding search operations in other cases, indicates a growing pattern of bank loan frauds in India that extend beyond a single firm or official.
A Pattern of Diversion, Shell Firms, and Systemic Bank Vulnerabilities
Sources from the ED suggest that the modus operandi in both cases follows a now-familiar pattern: obtaining loans using inflated balance sheets, diverting funds via a network of front companies, and defaulting with minimal traceability.
In CSPL’s case, authorities estimate that ₹6,210.72 crore in loan funds were siphoned off, with the principal amount(excluding interest) being the central focus of the investigation. The charges also cite lack of due diligence on the part of banks and weak regulatory oversight, raising fresh concerns about governance within India’s banking sector.
Officials believe these cases represent just a fragment of a deeper rot, where financial institutions, under pressure to disburse high-value corporate loans, overlook red flags. The involvement of senior officials like Goel also points to potential lapses or complicity at the top.