In a crackdown against high-value car loan scam at State Bank of India (SBI), the Directorate of Enforcement (ED), Mumbai Zonal Office, conducted a search operation on November 25 and 26 under the Prevention of Money Laundering Act (PMLA), 2002 and seized luxury cars-BMW, Mercedes, Volvo, and Land Rover which were allegedly purchased with loans taken on the basis of fake documents.

The investigation revealed that between 2017 and 2019, the bank was defrauded of crores. It is alleged that the then SBI Branch Manager Amar Kulkarni, auto loan counselor Aditya Sethia, and some borrowers colluded to inflate the actual loan amount, submitted fake quotations, and got high-value loans approved without document verification. 

During the search, the ED also seized papers of several immovable properties, suspicious digital records, and forged documents.

The borrowers allegedly did not just take small loans, but took loans worth crores to buy expensive cars, causing a huge loss to the bank. The ED says that this not only points to bank fraud but also strengthens the suspicion of money laundering. As a result, the ED is now engaged in tracing the financial trail of all transactions.

The ED's investigation revealed that the accused borrowers submitted fake income proofs, inflated car quotations, and fake ID proofs. This allowed the loan amount to be approved for many times more than the actual price.

Amar Kulkarni is accused of recommending loans without verifying the documents. By ignoring the bank's loan policy, an amount of crores was forwarded without verification.

What was found in the ED raids at 12 locations in Pune?

Luxury cars, fake agreements, digital files, and property records were seized from the offices of car dealers and the homes of borrowers. Many documents were found as direct evidence of the fraud.

The investigation made it clear that large loans were taken based on fake documents to purchase these cars. The EMIs for these vehicles were never paid, which proved the fraud to be even more serious.

The ED suspects that this could be part of a larger network. The next phase of the investigation is focused on tracking all financial flows (financial trail).

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