India's Central Bureau of Intelligence (CBI) has charged three Mumbai-based firms for cheating State Bank of India (SBI) using letters of credit (L/Cs).

Investigators allege that the privately owned firms took advantage of bill discounting facilities against the L/Cs.

Bank collusion

The CBI says that the three firms, in cahoots with SBI officials and unidentified persons, defrauded the bank of the equivalent of some US$21 million.

A CBI official said the firms and individuals involved included Top Worth Pipes and Tubes and its directors Abhay Narendra Lodha, Shishir Shivaji Hiray and Harshraj Shantilal Bagmar.

Fraudulent L/Cs

They conspired with SBI officials, including area manager Thyagaraju Inamanamelluri and deputy managers Vilas Narhar Ahirrao and Madhura Mangesh Sawant and others to perpetrate the L/C frauds.

Other firms charged by the CBI include Maheep Marketing and Harsh Steel Trade.

Bill discounting

According to investigators, the accused abused bill discounting facilities against L/Cs issued by SBI.

They also found irregularities such as the issuance of multiple invoices and false shipping documents.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.