He confessed he’d been embezzling since the COVID-19 pandemic; other bank officials claimed they didn’t know
Police presence was beefed up at the bank after hordes of account holders gathered there. Pic/Ashish Raje
AMID growing panic over the suspension of all transactions at New India Cooperative Bank, Mumbai Police’s Economic Offences Wing (EOW) arrested the former general manager, Hitesh Mehta, for allegedly siphoning Rs 122 crore from the bank’s treasury. “On Saturday, Mehta was brought to the EOW office for further questioning, His Dahisar house was also raided. He was then arrested,” confirmed EOW DCP Mangesh Shinde.
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The fraud was exposed during a routine inspection by the RBI at the bank’s corporate office in Prabhadevi on February 12. Central bank officials conducted a cash audit of the vault located on the third floor, where the bank’s funds were stored. Simultaneously, another team inspected the bank’s Goregaon branch.
The accused, Hitesh Mehta, hides his face (left) as the EOW escort him out for a medical test. Pic/Satej Shinde
RBI officials discovered a staggering shortfall of Rs 112 crore at the Prabhadevi office. This number rose to Rs 122 crore when the Goregaon branch’s cash records were reviewed. When questioned about the missing funds, senior bank officials claimed they had no knowledge of the discrepancy. The RBI then demanded an immediate explanation and a detailed report.
Mehta’s Confession
Later that evening, Mehta—who was also head accountant and oversaw cash management at the bank—arrived at the Prabhadevi office and was questioned by RBI officials. In the presence of senior bank executives, he confessed to the fraud, admitting that he had been withdrawing cash since the COVID-19 pandemic and had given the money to his acquaintances. His confession was recorded on a mobile phone by an RBI official, and he later provided a written statement confirming his actions.
On the same day, a formal complaint was lodged at the Dadar police station by Devarshi Ghosh, Acting Chief Accounting Officer at the bank. The next day, on Thursday, an FIR was registered by the EOW under BNS sections 316(5) (criminal breach of trust) and 61(2) (criminal conspiracy).
Authorities are now probing the extent of the fraud, tracing the misappropriated funds, and identifying if any additional individuals were involved in the scam. “This is not fraud but a case of allegations of misappropriation of funds, as stated in the FIR. The real question is, if the misappropriation had been happening since COVID-19, what was the bank doing? How can someone take R122 crore without the bank’s knowledge? My client is innocent and is being unfairly targeted. We will contest this in court,” said Advocate Chandrakant Ambani, CA Legal, representing the accused, Mehta.
Can’t believe it, say Mehta’s neighbours
Hitesh Mehta was picked up by the EOW from his 14th-floor apartment at NL Aryavarta, Dahisar East, around 1.30 pm. The EOW did not seize anything from his house during the raid. A member of the residential society told mid-day, “The Mehta family has lived in this society for many years; we are shocked that he could be involved in such a scam. His wife is aged and has health issues.” Another resident said, “We have never heard any negative things about the Mehta family before this. They live very simply, like any middle-class family. If Mehta is involved in this scam, he should be punished.”
Apart from citizens, residential societies that parked their funds with the bank have also been left in the lurch because of the embezzlement and subsequent freeze on transactions. The Mulund-based Devashish Society has had an account at the cooperative bank for the last 30 years. Society committee chairman CM Deshmukh said, “All our transactions to cover the society’s expenses are now stuck, including salaries for the staff. We are unable to access the savings account, which holds about R5 lakh. Luckily, we shifted the society’s FD to another bank a year ago. We won’t trust any co-operative banks after this.”
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