Muslim Co-op Bank board of directors chief denies misuse of funds

Muslim Co-op Bank board of directors chief denies misuse of funds

Submitted by alvin on Thu, 2016-06-02 15:49 Mysuru: Muslim Co-operative Bank, Board of Directors president Mir Umayun has denied allegations of misappropriation of bank funds by the board of directors.Addressing a press conference here, he dared Shafiulla Baig, a member of the bank that he and other board of directors will resign from their position if Baig proves his allegations. It may be recalled here that Baig, a resident of Lashkar Mohalla had recently alleged that the board of directors of Muslim Co-operative Bank allegedly favoured wives of directors in issuing loan, violating RBI norms. Their alleged mishandling of finances forced the RBI to serve notice imposing Rs one lakh penalty on May 3, Baig had said.Revealing documents, Baig had stated that the board had sanctioned loan in favour of eight women applicants, who later found out to be wives of eight directors. In fact, issuing loan to a relative is a serious offence under the co-operative bank act which could attract two years of punishment, Baig had stated.However, justifying the board’s action, Umayun said that applicants never took the loan in the name of their husbands but in the documents they had mentioned about their parent’s details. Under such circumstances, the bank does not restrict issuing loan to them hence all the eight directors cleared the loan amount of Rs 2.5 crore. How could this amount to misuse of funds, he asked. “We have all the documents to show the transparent process of loan sanctioning. We are ready to face any kind inquiry in this regard,” he said.Baig had unsuccessfully contested five elections for the board of directors and his allegations are stemmed from this disappointment, claimed Umayun adding he will file a defamation case against Baig.