A former bank chairman serving a prison sentence in an Indian jail for his part in a letter of credit (L/C) scam has been implicated in more allegations of bank fraud.

Chiman Patel, along with several members of his family may now face new charges alleging that they used false documentation to obtain loans from the now defunct Charotar Nagrik Sahakari Bank, of which Patel was once chairman.

High circles

The Patels are a prominent family in political and business circles in the western province of Gujarat.

The new charges are framed against Deepak Patel, a former Bhartiya Janta Party (BJP) member of parliament (MP) from Anand, and his brothers Bharat and Prakash.

Forged documents

The Patels have been accused of forging documents to obtain a loan from the now defunct Charotar Nagrik Sahakari Bank.

Deepak Patel, the then sitting MP, had secured a loan the equivalent of around US$1 million to buy some machinery for Sathi Publications. Deepak was the managing director and his brother directors of that company.

Failed to pay

The Patels allegedly failed to pay back their dues and the bank lodged a complaint against the trio and their father Chiman Patel, who was chairman of the bank when the loan was sanctioned.

Chiman is currently in a jail for his involvement in a US$4.3 million L/C scam that came to light in 2002 and which involved the now defunct Baroda People's Co-operative.

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