Thursday, July 24, 2014

Good Advocates And Good Bankers

It will not be an exaggeration to say that there is acute scarcity of good and honest officer in public sector banks. Because majority of officers not sitting at top posts and who are executives have come from the root of flattery and bribery only. 

When majority of seniors are corrupt , the damage to the organisation is inevitable. It is PS banks where promotion is given to flatterers in 2-3 years and abnormal hike is given. Bank management use to make excuse of shortage of quality officers , but bitter truth is that good officers are facing rejection in promotion processes all the time.

It is they who ignored good officers for two  to three decades in the name of merit . Now seniors do not find any interest in applying for promotion.

It is PS banks where recruitment is made in higher scale to give higher salary to freshers. 

And it is only PS banks where corrupt officers who are involved in recruitment scam , promotion scam and loan scam get safe exit , safe retirement and safe acquittal from charges of corruption and irregular lending.


Because majority of important posts and key posts are manned by corrupt officers only who like flatterers and bribe earners only. Officers who are not well versed in banking matters and who are not well experienced in operation and loan processes are made Branch Head and Departmental Head.

This is why during last two decades of liberal policy , these banks have accumulated bad assets in their portfolio and they are facing continuous erosion of capital. 

It is PS banks which suffer huge loss or suffer erosion in profit whereas on the contrary private banks prosper in the same way as private telecom service proivders gain in profit whereas BSNL suffers loss, Indian airlines suffer loss whereas Private airlines earn profit.

Who will bell the cat when majority of top officials forming bank management at various level are ill-motivated and corrupt minded?

Wednesday, July 23, 2014

Humiliation Of Bank Officers Will Continue?

Union Leaders Seems To Have Ignored Sacrifice of Ajay Sehgal - Forgotten Birthday ?-By Rajesh Goyal

It is now  three weeks that Mr Ajay Sehgal committed suicide.   We raised the issue in big way and a lot of hue and cry was raised in the social media.  All this forced the union leaders to take up the issue aggressively and the impact of this was that FGM and CH were suspended by the bank.  Different unions were extremely active on the FaceBook and other blogs etc. claiming their victory and efforts they have put to get both the seniors suspended.  Some of them have been sent congratulatory messages to their cadre.    

Later on we heard that there were talks of raising a fund for the family by certain sections of the unions.   One other union leader has taken a vow to change the system and had even hurriedly gone for a meeting with CMD.  Even the talks held in the meeting were put as show piece to give a feeling that they are extremely sincere and sensitive to such issues. 

All the above have given me some hope that something may change for the better and efforts will be made to de-stress the officer class in the banking.  
Now it is evening beyond 8.00 PM (22nd July, 2014).  Since morning  I have gone through FaceBook and other social media groups (the same groups where the union leaders have been so active during the first week of July),  in the hope that some updates will be given by union leaders.    

However, I did not find even a single word of remembrance to Ajay Sehgal who died due to pathetic attitude of top management and no timely action to de-stress the officer community in last decade since when the things have gone from bad to worse.  

I do not know whether I have missed such posts on FB ?  Our readers will be able to confirm what was the intensity of such discussions by leaders on 22nd July i.e. Birthday of Mr Ajay Sehgal ?

Now questions arises, why I was waiting for such an update.   If I remember correctly, 22nd July is the BIRTHDAY of Ajay Sehgal.   I am sure most of the union leaders have forgotten this or else they could have arranged certain meetings / updates to remember his sacrifice and the future course of action could have been announced so that such things do not happen.   How many of them visited the family today?

I am sure soon Mr Ajay Sehgal too will be forgotten  and  his efforts to bring the issue of humiliation of bankers to the forefront by giving his own life will be buried.   I feel it is already buried.

I am sure after reading this article, once again few union leaders will jump into the fray and claim how they celebrated his BIRTHDAY !

We have been receiving contradictory reports and thus I would like both the Unions to share the point-wise information on the following points so that officers know the truth.   The answers to these should not be evasive.   This will show that they are actually tracking the case and have concern for the officer community.   If they have no answers for these, it means the case is being buried fast.

(a) What is the status of the case with Chandigarh Police / Railway Police;

(b) Whether FGM / CH have joined their duties or are on leave?   If on leave, on what grounds they are on leave and who has sanctioned their leave?;

(c) If  FGM / CH are not traceable, then what action has been taken by PNB?

(d) Whether the dues of Mr Ajay Sehgal have been settled?   If not, the reasons for the same and by what time they are likely to be settled;

(e) Whether any fund has been raised by unions and if so, how much was collected and whether the same stands paid to the family;

(f) What type of additional concessions have been given by PNB to the family after the death of Mr Sehgal ?

(g) What written assurances / specific guidelines  have been given by PNB Management to ensure that such things will not happen in future? What has been done for banks other than PNB?

(h) In the meeting with CMD,  unions have asked for video-audio recording of proceedings, whether any agitational programme has been chalked out to achieve this?

(i) What are actions points that have been zeroed on by unions to de-stress the bank officers across the banking industry?  What are the agitational  programme finalised to achieve these?

The above are some of the questions which must be on priority at all times so that the sacrifice of Mr Sehgal does not go waste for the banking industry, and no family in future has to face similar situation.

RBI Choose Six Big Banks

Too-big-to-fail bank names by Aug '15: RBI-times of India

MUMBAI: Around four to six large banks are set to be classified as 'systemically important' by the RBI from August 2015 and will be subject to higher capital requirement and intense regulation. 

Systemically important is the term used by the RBI to describe institutions that are considered too big to fail as allowing a failure would cause a crisis in the financial system. Such large banks will be subject to intense regulation and higher capital requirements. 

Following the Lehman Brothers crisis, the Basel Committee on Banking Supervision — a panel of central bankers worldwide — prescribed a regulatory framework to deal with domestic systemically important banks (D-SIBs). The indicators which would be used for assessment are: size, interconnectedness, substitutability and complexity. Based on these parameters State Bank of India, HDFC Bank and ICICI Bank are widely expected to be among the D-SIBs. 

How India’s Private Banks Duck NPAs

Amit Bhandari, Bad loans by public sector banks, which account for the bulk of the banking system in India, have tripled over the past three years. Gross non-performing assets (NPAs) of public sector banks stood at Rs 216,739 crore at the end of March 2014, three times the figure for March 2011.

On the other hand, NPA figures for the private sector banks, which are much smaller than their public sector counterparts as a group, have been much better. Total NPAs for private sector banks stood at Rs 22,744 crore at the end of March 2014, up 26% over the past three years. Looking at other publicly available information, it would appear that private sector banks do a better job of managing loans, which may turn bad. But the reason in some ways is simple. They have been more pro-active with tools like debt restructuring.
Indeed, the situation could be much worse if not for the corporate debt restructuring (CDR) mechanism, which allow payment terms and interest rates on an outstanding loan to be renegotiated before it turns into an NPA.

CDR packages also involve fresh working capital loans to the distressed borrower and fresh equity infusion by the promoters. Lenders representing 75% of the outstanding loan amount must agree to the CDR package. Loans worth Rs 330,444 crore had been approved by the CDR cell till March 2014. Else, the NPA figure could have been even higher. The total value of loans under CDR stood at Rs 229,013 crore in March 2013, indicating the sharp increase here as well.

The list of industries in CDR is dominated by infrastructure, iron & steel, power, textiles, ship-building/ship-breaking and telecom. The total loan value under CDR in these sectors exceeds Rs 10,000 crore each. Two sectors where the value of CDR packages has shot up in the past 12 months are infrastructure and ship-building. In both the sectors, a few large corporate accounts are responsible for the increase.

In March this year, a group of 22 lenders cleared a debt restructuring proposal of Rs 11,000 crore. Earlier, in 2013, a Rs 13,500 crore CDR package had been cleared for Gammon India, an infrastructure company involved in construction and development of roads, ports and other such projects. The shipbuilding sector has been hit by an international slowdown following 2008 while the infrastructure sector’s problems are domestic in nature. Wind energy major Suzlon received approval for a CDR package for its debt of Rs 9,500 crore.

News reports had identified ICICI Bank as a leading lender to ABG and Gammon. Going by these numbers, it seems private sector banks are more willing to let a large lender go for debt restructuring rather than let it turn into an NPA. Had these accounts turned NPAs, they would have been several times larger than Kingfisher or Winsome Diamonds – which currently lead the bad loan list of the banking sector.

RBI Will Select 6 Important Banks

Reserve Bank of India to identify six systemically important bank-Economic Times
MUMBAI: The Reserve Bank of India has said that up to six banks will be designated as systemically important, or SIBs, for the domestic financial market and will need to have higher capital than their peers to prevent the financial system from collapsing if there is a crisis.

The central bank said it would now go about identifying these banks which are too big to fail and would release a list of names in August 2015, according to a report uploaded on its website on Tuesday evening.

State Bank of India, Punjab National Bank, Citibank, Standard Chartered Bank, ICICI Bank and HDFC Bank may be among the six, according to consultants and analysts. Banks falling in this category will have to set aside more capital per loan than their peers.

Size, interconnectedness, lack of readily available substitutes or financial institution infrastructure and complexity will determine the systemic importance of banks as determined by Basel global standards. But, in India, size would be assigned higher weight than other factors, said RBI.

Based on which category the bank falls, it has to set aside 0.2% to 0.8% of the loan as capital buffer. In other words if the bank was setting aside Rs 1 earlier, it would now have to set aside between Rs 1.20 and Rs 1.80. "Size is a more important measure of systemic importance than any other indicators and, therefore, size indicator will be assigned more weight than the other indicators," RBI said. "Bankshaving a size beyond 2% of GDP will be selected in the sample." However banks whose size is less than 2% of GDP may also face tighter norms.

Banking regulators across the world are tightening capital norms for banks and other key financial institutions as the lack of capital was seen as a root cause of the 2008 credit crisis that threatened to bring down the global financial system. 

Reserve Bank of India to identify six systemically important banks
Although bankers were able to beat back tough capital norms in some instances, overall the regulators have managed to tighten a bit.

"We have to be careful with how much capital we burden banks to raise," said Shikha Sharma, chief executive at Axis BankBSE -1.11 %. "For the risk banks carry on books, we need to set aside capital.

Too much charge on capital will affect growth. One has to get the balance right."

Although the Indian arms of most foreign banks will escape the need for tougher capital norms because of the relatively smaller asset base, the central bank will also consider their derivatives exposure to assess their importance.

"Foreign banks are quite active in the derivatives market, and the specialised services provided by these banks might not be easily substituted by domestic banks," said RBI. "It is, therefore, appropriate to include a few large foreign banks also in the sample of banks to comp .. 

Monday, July 21, 2014

RBI Announces Polic For Small Banks And Payment Banks

Finally, small is beautiful in Indian banking-LIVEMINT-22nd July 2014

It won’t be surprising to see hundreds of applicants queuing up for a small bank licence
BY Tamal Bandyopadhyay

Reserve Bank of India (RBI) governor Raghuram Rajan has kept his promise.
Less than four months after giving in-principle licence to two entitles for setting up commercial banks, RBI has drafted guidelines for so-called payments banks and small banks to open up the sector. A third category, wholesale banks, will probably be looked into later.
The payments banks, according to the plan, will accept deposits and offer remittance services to migrant workers, low-income households and small businesses in a secure, technology-driven environment.
The remittance business will earn fees, but will that be enough to run a bank? It will also get the so-called float money (the money kept in the custody of a bank between a deposit made in the recipient’s account and the money deducted from the sender’s account).
Such banks will not be able to give loans to anybody. Instead, they will invest all their deposits in government bonds. Minus the remittance business, in some sense, it resembles the model of erstwhile residuary non-banking companies, or RNBCs (remember Sahara India Financial Corp. Ltd and Peerless General Finance and Investment Co. Ltd?). Narrow banking—or the model of investing the last penny of deposits in government bonds—ensures safety but it’s difficult to make such a bank profitable unless the employees see this as charity and don’t take a salary.
I wonder why would anybody apply for a payments bank licence while such activities can be done through the small banks? Yes, the small banks are being allowed to do everything a commercial bank is expected to do but on a smaller scale. It is modelled on the local area banks, or LAB (former finance minister P. Chidambaram’s brainchild), with a difference. While operations of a LAB are restricted to contiguous districts in one state, the small banks will be allowed to expand their area of operations beyond contiguous districts in more than one state. The limit will not be on geographical spread, but size of the business as it is expected to undertake basic banking activities of accepting deposits and lending to small farmers, small businesses, micro and small industries and unorganized sector entities.
Chidambaram made public the idea of LAB in his 1997 budget speech. Six LABs got licences but at the moment only four of them are operational—in Punjab, Maharashtra, Andhra Pradesh and Telangana. The biggest handicap of a LAB is its playing field—a few contiguous districts (initially capped at four and later expanded to six). Such banks suffer from concentration risks as often natural calamities such as drought and flood affect contiguous districts and if that happens, the risks of mass defaults in loan repayment rise. Precisely for this reason, the LABs in India have not done well. Two of them died premature deaths and the largest one, based in Punjab, is very small compared with a commercial bank. By allowing small banks to operate in many districts and across states, RBI has taken care of this.
There will be many takers for the small bank, including a few of those who had sought licence to set up a universal bank but did not succeed in getting it. They could not meet the criterion of ‘fit and proper’ last time, but that does not mean they will fail this time, too. The draft guidelines have tweaked the fit and proper criterion for small and payments banks by removing the reference to a probe by an investigating agency as a deterrent to giving licence. If such banks can prove their competence, over time their scope of operations will widen. But to start with, small could be beautiful and I will not be surprised if hundreds of applicants queue up for a small bank licence.

Questions remain on viability of proposed payments banks-Livemint

RBI’s draft guidelines on payments banks have received a cautious welcome from probable entrants

The Reserve Bank of India’s (RBI) draft guidelines on payments banks have received a cautious welcome from probable entrants.
While most agree there is space for such banks in India, the restrictions and conditions proposed have raised questions on whether the model would be a viable business proposition
Payments banks are a new category of banks envisaged to provide limited services such as accepting savings deposits and remittances, particularly in rural areas.
One key concern will be profitability. This is because payments banks will not be allowed to lend, effectively cutting off interest income—the main income source for a bank—although remittance services are permitted and could become the main income stream.
Again, they must invest all their deposits in government securities and treasuries maturing in one year, restricting the scope of investment income as well.
According to Rishi Gupta, chief operating officer (COO) at Fino Paytech Ltd, a banking correspondent which is also in the fray to open a payments bank, these banks will have to keep their cost of operations “really thin” to make profits.
“Banks will have to figure out how to make the model viable within the framework provided. But there are two-three areas where revenues can come from; firstly from the difference in the deposit rate a bank offers and the yield it earns from investments and also charging micro and small enterprises for services and individuals for remittances,” Gupta said.
Charges will depend on the kind of products these banks offer and linked very closely to the demographics of the geography they operate in, he said.
What interest these banks offer on deposits and how they manage their cost of operations will be crucial in determining how viable they will be, a Kotak Institutional Equities Research report said on 17 July. “As compared to conventional banks, we are not too sure if we can understand the profitability of these banks. The severe restriction on lending makes the business model extremely challenging,” M.B. Mahesh, Nischint Chawathe and Geetika Gupta said in the report.
The Kotak analysts added that these banks were unlikely to be in a position to provide 4% interest rate on savings accounts, as the spreads of the business are too thin. This could be a competitive disadvantage, as most banks in India offer 4% on savings bank deposits, while some smaller banks offer even higher. The analysts said payments banks, to make their model viable, will have to link the interest rates they offer on savings bank accounts to the yields they get on their government security investments in order “to reduce the volatility of returns.”
A cap of Rs.1 lakh on the balance a customer can keep in his account could also prove to be a challenge for such banks, said analysts.
Remittances, however, could prove to be a lucrative fee-generating activity, said some firms. Pradeep Kumar Sampath, chief operating officer, MMP Mobi Wallet Payment Systems Ltd (MMPL), a mobile payments company and a subsidiary of Tata Teleservices Ltd, said the company was looking at this new opportunity as a pure remittance model.
“There may be opportunities to leverage customer reach through financial inclusion, value-added or independent service for telcos, much more access through a mobile phone,” Sampath said, adding that though the company will be able to route its transactions through its own bank now, transaction costs for the end customer may not come down.
Robin Roy, associate director, financial services at audit and consultancy firm PricewaterhouseCoopers (PwC) said that for this model to become successful, customers will have to be charged.
“This is a fee income-based system. It has always been a business model in the OECD markets because it’s a part of the alternative channels. India now has more mobile phones than bank accounts and it is possible to make a market to ensure that we move more cash transactions to cashless mode,” Roy said.
Meanwhile, the firms likely to have a headstart in the payments bank business are those which already have a network in rural areas. Building a network from scratch may make it difficult for firms to make money, said Abizer Diwanji, partner and head of financial services at audit and consultancy firm E&Y.
“Companies which already have an access to the last-mile customer like telecom companies, microfinance companies and retailers will have an advantage; otherwise, to build a network like this doesn’t look profitable,” Diwanji said.
Retailers, along with telecom companies could be best placed to launch payment banks without much incremental investments.
“We have always been keen and feel the draft guidelines are tailor-made for us. Once the policy is out, we will be the first ones to launch operations,” said Kishore Biyani, chief executive officer of Future Group, the parent firm of Future Retail Ltd which operates the Big Bazaar and Food Bazaar retail chains.
Also, for firms currently out of the banking arena, it is important to understand concepts like capital requirements to which they are new, said Naveen Surya, managing director, at ItzCash Card Ltd, a prepaid card and money transfer company and one of the firms interested in setting up a payments bank.
“We will give RBI our suggestions and also try to understand the requirements with regards to capital because it is a new subject for us. These are still draft guidelines and the decision of when and how we enter this space can only be made when the final guidelines are out. We are already present in 3,000 locations with 50,000 touch points accepting our cards which holds us in good stead,” he said.
Payment banks have to adhere to the easier Basel I standards compared with the more stringent Basel III standards for commercial banks. RBI has asked for feedback on the draft norms by 28 August

Small Bank AND Payment Bank

All you want to know about Small Banks and Payments Banks

Draft guidelines likely to benefit micro finance and telecom companies but it is unlikely to attract large NBFCs
                      In order to expedite financial inclusion, finance minister Arun Jaitleyin his budget speech said "RBI will create a framework for licensing small banks and other differentiated banks. Differentiated banks serving niche interests, local area banks, payment banks etc. are contemplated to meet credit and remittance needs of small businesses, unorganized sector, low income households, farmers and migrant work force." 
Within a week of the budget, RBI issued draft guidelines for setting up small banks and payment banks. RBI in its guidelines said that both payment banks and small banks are ‘niche’ or differentiated banks, with the common objective of furthering financial inclusion.
In a report on the regulation, Alpesh Mehta and Sohail Halai of Motilal Oswal have collated the guidelines with the conclusion that the move is positive for micro finance and telecom companies but it is unlikely to attract large NBFCs. 
Following are some of the conditions which are common to both the banks as collated by Motilal Oswal.
· The minimum capital requirement would be Rs 100 crore
· Promoter contribution would be at least 40 per cent for the first five years. Excess shareholding should be brought down to 40 per cent by the end of fifth year, to 30 per cent by the end of 10th year and to 26 per cent in 12 years from the date of commencement of business
· Foreign shareholding in these banks will be as per current FDI policy
· Voting rights to be line with the existing guideline for private banks
· Entities other than promoters will not be permitted to have shareholding in excess of 10 per cent.
· The bank should comply with the corporate governance guidelines, including ‘fit and proper’ criteria for Directors as issued by RBI
· Operations of the bank should be fully networked and technology driven from the beginning
Small Banks
· The purpose of the small banks will be to provide a whole suite of basic banking products such as deposits and supply of credit, but in a limited area of operation.
· The objective for these Small Banks is to increase financial inclusion by provision of savings vehicles to under-served and unserved sections of the population, supply of credit to small farmers, micro and small industries, and other unorganised sector entities through high technology-low cost operations.
· Resident individuals with 10 years of experience in banking and finance, companies and Societies will be eligible as promoters to set up small banks. NFBCs, micro finance institutions (MFIs), and Local Area Banks (LABs) can convert their operations into those of a small bank. Local focus and ability to serve smaller customers will be a key criterion in licensing such banks.
· Branch expansion: For the initial three years, prior approval will be required.
· The area of operations would normally be restricted to contiguous districts in a homogenous cluster of states of union territories so that the Small Bank has a ‘local feel’ and culture. However, if necessary, it would be allowed to expand its area of operations beyond contiguous districts in one or more states with reasonable geographical proximity.
· The bank shall primarily undertake basic banking activities of accepting deposits and lending to small farmers, small businesses, micro and small industries, and unorganised sector entities. It cannot set up subsidiaries to undertake non-banking financial services activities. After the initial stabilisation period of five years, and after a review, the RBI may liberalise the scope of activities for Small Banks.
· The promoters’ other financial and non-financial services activities, if any, should be distinctly ring-fenced and not co-mingled with banking business.
· A robust risk management framework is required and the banks would be subject to all prudential norms and RBI regulations that apply to existing commercial banks, including maintenance of CRR and SLR.
· In view of concentration of area of operations, the Small Bank would need a diversified portfolio of loans, spread over it area of operations. 
· The maximum loan size and investment limit exposure to single/group borrowers/issuers would be restricted to 15 per cent of capital funds.
· Loans and advances of up to Rs 25 lakhs, primarily to micro enterprises, should constitute at least 50 per cent of the loan portfolio.
· For the first three years, 25 per cent of branches should be in unbanked rural areas.
Payments Banks
· Objective of payments banks is to increase financial inclusion by providing small savings accounts, payment/remittance services to migrant labour, low income households, small businesses, other unorganised sector entities and other users by enabling high volume-low value transactions in deposits and payments/remittance services in a secured technology-driven environment.
· Those who can promote a payments banks can be a non-bank PPIs, NBFCs, corporate’s, mobile telephone companies, super market chains, real sector cooperatives companies and public sector entities. Even banks can take equity in Payments Banks.
· Payments Banks can accept demand deposits (only current account and savings accounts). They would initially be restricted to holding a maximum balance of Rs 100,000 per customer. Based on performance, the RBI could enhance this limit.
· The banks can offer payments and remittance services, issuance of prepaid payment instruments, internet banking, functioning as business correspondent for other banks.
· Payments Banks cannot set up subsidiaries to undertake NBFC business. 
· As in the case of Small Banks, other financial and non-financial services activities of the promoters should be ring-fenced. 
· The Payments Banks would be required to use the word ‘Payments’ in its name to differentiate it from other banks.
· No credit lending is allowed for Payments Banks.
· The float funds can be parked only in less than one year G-Secs

Jail For Commiting Bank Fraud

Fraud at Union Bank: 3 sentenced to 3 yrs R-I--Indian Express 21st July 2014

City businessmen LR Bhojwani and Sanjay Bhojwani of Bhojwani Hotels Private Limited have been sentenced to three years rigorous imprisonment by a special judge in Bangalore in a 13-year-old case of financial embezzlement.
Former chief manager of a Bangalore branch of Union Bank of India has also been sentenced to three years of RI in the same case.
Bhojwani group owned two landmark city hotels – Holiday Inn and Hotel Amir – which were later auctioned by Debt Recovery Tribunal (DRT) in 2003 after the group failed to repay a loan and interest amounting to Rs 42 crore to Indusbank.
Earlier this week, special CBI judge convicted L R Bhojwani, chairman of the Bhojwani Hotels Pvt Limited and Bhojwani Brothers Consultancy and Services and Sanjay Bhojwani, director of both companies under sections of conspiracy (IPC 120-B) read with section 409, IPC section 420, 467, 468 and 471 IPC.
K Ramamurthy, former chief manager, Union Bank of India, Gandhinagar branch was also charged and convicted in same charges. The court has asked the Bhojwani as well as the two companies involved to pay a fine of Rs 1.5 lakh each while Ramamurthy has been asked to pay a fine of Rs 1.25 lakh.
According to CBI, L R Bhojwani and Sanjay Bhojwani had hatched a conspiracy to cheat the Union Bank of India with Ramamurthy’s help sometime between 1996 and 2000 in Pune and Bangalore.
They had submitted forged deeds and letters of power of attorney to the bank and availed a loan from the bank.
This fraud has resulted in a loss of Rs 9.57 crore to the Bank. Central office of the Union Bank of India had registered a complaint against the trio with CBI on December 31, 2001.

Bank Clerk, Bro held for Rs 11L Fraud

SALEM: A 31-year-old woman, a bank clerk, and her brother allegedly swindled money from her neighbour’s bank account here and were arrested on Saturday night in this connection.
According to Alagapuram police, Mohan (79), a resident of Mitta Pudur and a retired Electricity Board official, was the neighbour of Manju alias Mahalakshmi (31), a temporary clerk in a nationalised bank.
Mohan had an account in the bank and often used to seek Manju’s help for transactions. Recently,  Mohan gave a cheque book with his signature to Manju for withdrawing `11 lakh he had deposited in the account. On learning this, Manju allegedly withdrew the money from the account using the cheque. And she informed Mohan that his amount had been transferred to a new scheme. Mohan believed this.
A few months back, Manju was dismissed from service following some complaint.
When Mohan asked her to withdraw the sum from the bank, she refused. Mohan got suspicious and  went to the bank only to find his account empty. Shocked, he asked Manju again and she sought time to return the money.
On Saturday evening, Mohan lodged a complaint with Alagapuram police and a case was registered.
Later, Manju and her brother Rajarathinam (33), who reportedly helped her, were arrested and remanded in prison.