The Central Bureau of Investigation has arrested three officials from Indian Bank, including a Chief Manager, for allegedly demanding and accepting a bribe from a local business owner in Eluru. The arrests took place on 18 April 2026 following a trap operation at the bank’s Narasimharao Peta branch. Those taken into custody include the branch’s Chief Manager, a Clerk-cum-Cashier, and a Gold Appraiser. The federal agency acted on a complaint from a businessman who alleged that the officials attempted to extort money in exchange for maintaining his sanctioned credit facility.
Allegations of Coercion and Audit Threats
The complainant, who operates an auto agency in Eluru, holds an overdraft cash credit limit of ₹50 lakh at the branch. According to the CBI, the bank officials contacted the complainant while he was traveling in Rajasthan between 30 March and 17 April 2026. They reportedly informed him that a recent audit had flagged technical issues with his account. The officials allegedly warned that these irregularities could lead to his credit limit being slashed to ₹20 lakh or the account being declared a Non-Performing Asset.
To avoid such adverse actions, the Chief Manager reportedly demanded an undue advantage of ₹50,000, calculating the bribe at a rate of ₹1,000 for every lakh of the credit limit. The FIR suggests the official claimed this money was necessary to cover payments allegedly made to an auditor to suppress the reported issues. Following a series of negotiations, the demanded amount was eventually reduced to ₹30,000.
Trap Operation and Immediate Arrests
Upon receiving the complaint, the CBI organized a trap operation on 18 April to catch the suspects in the act. The three bank employees were apprehended while allegedly accepting ₹25,000 as a part of the bribe agreement. The agency confirmed that the money was recovered on the spot during the sting. Subsequent to the arrests, the CBI initiated searches at various locations linked to the accused individuals to gather further documentary or digital evidence of the transaction.
The three individuals are expected to be produced before the competent court in Vijayawada as the investigation continues. This crackdown is part of a broader effort by federal authorities to address corruption within the public banking sector, particularly concerning the management of sanctioned business loans and credit lines.
Broader Investigation Into Banking Malpractice
Preliminary findings suggest that the officials leveraged the fear of audit objections to extract payments from the borrower. The CBI is currently scrutinizing digital records and communication logs to determine if this was a recurring practice at the branch. Investigators are also looking into the possibility that other account holders may have been subjected to similar coercive demands under the guise of regulatory compliance.
The agency is further investigating whether any external parties, such as auditors or private individuals, played a role in facilitating the bribe demand. Financial experts noted that the case highlights a significant vulnerability for small business owners who rely on steady credit flow for their daily operations. The outcome of the probe will depend on the forensic analysis of seized documents and witness statements, with the CBI not ruling out further arrests if a wider network of involvement is identified.
