Mumbai: Special CBI Court Convicts 63-Year-Old Businessman, Wife & Ex-Banker In ₹6.82 Crore Bank Fraud Case
Mumbai: A special CBI court convicted Brian Castelino, 63, his wife Rajani Castelino, directors of R-Tec Systems Private Limited, and Alam Sheikh, a former manager at Corporation Bank’s Ghatkopar branch, for defrauding the bank of Rs 6.82 crore in 2009.
The court sentenced the trio to one year’s imprisonment each, with fines of Rs 25,000, but granted bail for appealing in a higher court. Leniency was shown in sentencing as most of the defrauded amount was recovered.
About The Case
The CBI initiated the case following a complaint from Corporation Bank’s Deputy General Manager, alleging that the Castelinos, through their firm, secured post-shipment finance and foreign export bill discounting facilities using fraudulent means. Between July 15 and November 17, 2009, they submitted 35 invoices, availing credit of Rs 6.82 crore by presenting 28 fake software export bills without certification from the Software Technology Park of India (STPI).
The STPI, under the Ministry of Electronics and Information Technology, mandates Softex forms to track foreign exchange inflows for software exports, as required by the RBI. Investigations revealed that only seven of the 35 invoices were certified by STPI, with the remaining 28 rejected due to discrepancies. The CBI alleged that the Castelinos, with dishonest intent, submitted forged, uncertified Softex forms to the bank for bill discounting, cheating the institution.
Sheikh, the bank manager, was implicated for approving these transactions without verifying the export status, enabling the fraud. The misappropriated funds were diverted to sundry debtors, and Sheikh failed to forward the forex bills for realisation. The court noted, “The submission of original forms without STPI certification demonstrates fraud by the accused, with Sheikh overlooking this and recommending credit release.”
The defense argued that the 2009- 2010 global financial crisis led to the bankruptcy of three of the couple’s clients, rendering their accounts non-performing assets (NPAs). They claimed the couple, longstanding bank customers, had no intent to cheat, having mortgaged properties, including row houses sold by the bank to recover dues. Despite these arguments, the court found the couple guilty, stating, “The accused obtained funds without exporting software, submitting original uncertified Softex forms instead of duplicates and failing to provide certified forms as promised.”
However, the court acknowledged their offer of collateral security and partial recovery of the amount, justifying the lenient sentence. The case highlights vulnerabilities in banking processes and the importance of stringent verification in export financing. The accused’s bail allows them to appeal, but the verdict underscores accountability for financial misconduct.
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