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Mumbai, October 6, 2026 (Yes Punjab News)
The Enforcement Directorate (ED) has conducted searches at nine locations in Maharashtra's Yavatmal district in connection with an alleged Rs 242 crore fraud involving officials of Babaji Date Mahila Sahakari Bank Ltd and its borrowers.
The searches were carried out by the ED's Mumbai Zonal Office-II under the Prevention of Money Laundering Act (PMLA), 2002. The investigation was initiated on the basis of multiple FIRs registered by Avdhutwadi Police Station in Yavatmal against bank officials, employees and borrowers, the agency said.
The cooperative bank was originally registered under Section 9(1) of the Maharashtra Cooperative Societies Act, 1960. Its license was canceled by the Reserve Bank of India in 2022 following a series of complaints alleging fraud and misuse of depositors' funds, after which the state government ordered a special audit.
According to the ED, the audit found that the bank's CEO, chairperson, directors and other officials allegedly acted in connivance with borrowers, valuers and auditors to sanction loans without adequate collateral or proper assessment of borrowers' repayment capacity.
The loan funds were subsequently allegedly diverted in violation of the bank's bye-laws, loan policy and RBI guidelines.
Investigators found an alleged fraud of Rs 242 crore involving the chairperson and bank officials in collusion with loan beneficiaries. The local law enforcement agency has already filed a chargesheet in the case.
The ED said its searches uncovered an alleged nexus between bank officials and borrowers in the diversion of loan funds. According to the agency, money obtained through loans was allegedly used for personal purposes, withdrawn in cash, deployed for evergreening of loans and transferred to accounts of bank officials as kickbacks.
Investigators also found that credentials of existing borrowers were allegedly used to create dummy loan accounts. Mortgaged property valuations were allegedly manipulated, enabling further diversion of loan amounts.
The searches resulted in the seizure of a large number of incriminating documents, including property-related papers.
Further investigation is underway.
The case highlights alleged systemic irregularities in the functioning of the cooperative bank and suspected collusion between its management and loan beneficiaries that resulted in the diversion of funds on a significant scale.