ABG Shipyard Ltd, which is engaged in shipbuilding and ship repair, will go down as the biggest bank fraud case registered by the Central Bureau of Investigation (CBI).

The CBI has filed a case against ABG Shipyard and its then chairman and managing director Rishi Kamlesh Agarwal along with others for allegedly defrauding 28 banks of over Rs 22,842 crore.

Private lender ICICI Bank’s exposure to ABG Shipyard is the highest at Rs 7,089 crore, followed by IDBI Bank at Rs 3,634 crore. ABG Shipyard owes Rs 2,925 crore to the state-owned State Bank of India, Rs 1,614 crore to Bank of Baroda, Rs 1,244 crore to Punjab National Bank and Rs 1,228 crore to Indian Overseas Bank.

The funds were used for purposes other than which they were released by banks, the CBI said.

The CBI has also named the then Executive Director Santhanam Muthaswamy, Directors Ashwini Kumar, Sushil Kumar Agarwal and Ravi Vimal Nevetia and another company ABG International Pvt Ltd for alleged offences of criminal conspiracy, cheating, criminal breach of trust and abuse of official position under the IPC and the Prevention of Corruption Act.

The State Bank of India had first filed a complaint on November 8, 2019, on which the CBI had sought some clarifications on March 12, 2020.

The bank filed a fresh complaint in August that year. After “scrutinising” for over one and a half-year, the CBI acted on the complaint filing an FIR on February 7, 2022.

The company was sanctioned credit facilities from 28 banks and financial institutions with the SBI having exposure of Rs 2,468.51 crore, they said.

The forensic audit has revealed that between 2012-17, the accused colluded together and committed illegal activities including diversion of funds, misappropriation and criminal breach of trust, the CBI alleged in its FIR.

Funds were used for purposes other than for which they were released by banks, it said.

According to the CBI, the fraud has taken place through the diversion of funds, misappropriation, and criminal breach of trust with an objective to "gain unlawfully at the cost of the bank's funds". 

The forensic audit report shows the fraud has taken place between April 2012 and July 2017, the CBI FIR said.