Police have arrested jewellery businessman Nilesh Bafna in an alleged ₹38 crore bank fraud case involving claims that gold, diamonds and jewellery inventory was substantially overstated to obtain credit facilities from a cooperative bank. Investigators are examining the difference between the stock declared to the lender and the inventory reportedly found at the business.
Inventory Worth Over ₹59 Crore Allegedly Declared
According to the complaint, the jewellery business submitted stock statements and supporting documents that allegedly showed inventory valued at more than ₹59 crore.
Investigators claim the jewellery and other stock actually available at the establishment was worth only a fraction of the declared amount. The discrepancy emerged during a review of loan accounts, inventory declarations and assets reportedly offered as security.
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Authorities suspect the bank relied on valuation records and inventory information submitted by the borrower when extending financial assistance. The investigation is examining whether inaccurate declarations were knowingly made and whether documents were manipulated to obtain borrowing limits that would not otherwise have been approved.
Repeated credit facilities were allegedly secured using inventory statements that did not reflect the business’s actual stock position, leaving the cooperative bank exposed to losses estimated at approximately ₹38 crore.
Businessman and Guarantors Named in Case
Police have registered a case against Bafna and several other people linked to the transactions, including alleged guarantors.
Investigators are examining the role of each accused, the preparation and submission of documents and the circumstances in which the credit facilities were sanctioned.
After his arrest, Bafna was produced before a court and remanded to police custody for further questioning and collection of evidence.
Authorities are analysing banking records, financial statements and inventory documents to trace the loan transactions and establish how the disputed stock figures were presented to the lender.
Lending and Valuation Procedures Under Scrutiny
The investigation is also examining whether there were shortcomings in the verification and inspection processes followed before the loans were sanctioned.
Officials are expected to review valuation certificates, inspection reports and correspondence connected with the lending arrangements. A central question is whether the lender independently verified the existence and value of the assets reportedly offered as security.
Inventory-backed lending generally relies on accurate stock statements, periodic audits and physical inspections. Discrepancies between declared and available stock can expose lenders to substantial losses when business inventory serves as the principal collateral.
The investigation remains underway as police review additional records and evidence. Further details are expected to emerge during the probe and subsequent court proceedings.
