Whose home is it anyway?

The Reserve Bank of India, RBI, last week raised the red flag on banks doling out home loans. A booming real estate market has meant huge demand and many fraudsters have jumped on to the bandwagon, along the way. They are promising consumers home loans without any documentation or checks. What is shocking is that they are succeeding.

Shantanu Parab is a Bcom graduate, who ran a catering business with his wife Shammi before they were arrested for allegedly duping six banks of Rs 32 lakhs. The couple was arrested on  April 4 by the Thane police, on a complaint filed by Greater Bombay Co-operative Bank.
The bank alleges that the couple had submitted forged property papers and duped the bank of Rs 10 lakhs.

But this is not the first time that the duo’s name has cropped up with the police. They have been asconding for the last one year and were wanted for procuring home loans on forged documents. Between April 4 and 6 this year, the Naupada police station received complaints against the them from the Greater Bombay Co-operative Bank, Federal Bank and Bank of Baroda for procuring home loans by using forged documents.

During the probe, police stumbled upon evidence to suggest the duo had duped more than a dozen banks by mortgaging the same property over and over again.

The banks they scored with:

Greater Mumbai Co-operative Bank duped of Rs 9.75 lakhs Indian Overseas Bank duped of Rs 13.25 lakhs State Bank of India duped of Rs 13.25 lakhs Andhra Bank duped of Rs 13.25 lakhs Federal Bank duped of Rs 10 lakhs Bank of Baroda duped of Rs 10 lakhs

The modus operandi was simple. Police sources say that the couple would approach various banks as customers in need of a home loan. Once an intial sanction was given, the duo would approach Vijay Ahuja, a small time agent in Thane, who would allegedly forge registration papers and deeds of the Parab’s flat in New Bombay (a suburb of Mumbai) and these duplicate documents were submitted to various banks.

Police sources reveal the fraud may touch Rs 1 crore and the duo have allegedly duped close to 25 banks in Mumbai, which include Citifinancial and Bank of Hyderabad. Cases of fraud have also been registered against them at Sion police station in Mumbai.    

Assistant Police Inspector, Naupada (Thane), Kailash Avhad explains, "The modus operandi was that they would go to the bank for a home loan, forge the papers and submit it to the bank and get a home loan and later default in their payments."

The Parabs are far from a one-off case. The Mumbai police recently arrested another person in a similar home loan fraud.

Vasant Rao More is not your average criminal. A builder, More drove a Mercedes and had two bodyguards surrounding him at all times. That was before he was arrested by the Mumbai police’s Economic Offences Wing on April 12 in Pune for cheating banks of crores of rupees.

According to the police, More approached Mumbai-based builders, Avani Contructions, and signed a memorandum of understanding, MoU, to buy 15 flats at a project in Mira Road. But since his two cheques bounced, Avani Constructions could give him ownership of just three flats.

But More did not return the MoU. Instead, he changed the name on the MoU to his own company - Dharti Constructions. He prepared 15 fake agreements. More’s aquaintances like rickshaw drivers then pretended to buy flats, and approached the State Bank of Mysore for a home loan.

Loans worth Rs 95 lakhs were disbursed to More’s account. Months later, the bank lodged a compliant with the police, when the loans were not paid. Police say more forged documents like income tax returns and salary slips to procure loans from the bank. He also offered customers gold chains and Rs 5,000 to Rs 10,000 as an incentive to buy a flat from him. These were flats that he did not even own.

The same game was played out in State Bank of Mysore’s Lokhandwala branch. The branch paid out Rs 42 lakhs to More as home loan. More almost got away with duping Dena Bank of Rs 19 lakhs. But the bank quickly detected the forged documents.

So how widespread is this racket? There are many agents who promise higher loans on the basis of forged salary and income statements. Often, consumers are shown as employees of companies, that do not even exist and backdated salary statements are generated in connivance with some bank staff.

Banks are clearly worried about this and this is what the biggest home loan provider has to say. General Manager, ICICI Bank, Rajeev Sabharwal says, "If banks are facing such a problem, then they need to tighten their checks."

Khushboo Narayan & Mehak Kasbekar