The Mumbai police on Saturday arrested Hitesh Mehta, former general manager and head of accounts of the New India Cooperative Bank, for allegedly siphoning Rs 122 crore from the lender. 

Mehta was arrested by the Economic Offences Wing (EOW) of the Mumbai police after being questioned for more than three hours on 15 February.

He was called to record his statement before the probe agency at its south Mumbai office in connection with the case registered against him and others.

Mehta will be produced before a local court on Sunday. 

On Friday, the Reserve Bank of India (RBI) superseded the co-operative bank's board for 12 months and appointed an administrator to manage its ongoing affairs. 

A day prior to that, the central bank imposed several restrictions on the lender, including on withdrawal of funds by depositors, due to supervisory concerns emanating from the recent material developments in the bank and lending irregularities during inspections.

According to police, Mehta is accused of misappropriating funds while overseeing the bank's Dadar and Goregaon branches in Mumbai. The fraud, which allegedly occurred between 2020 and 2025, was detected when discrepancies appeared in the bank's financial records. An internal audit flagged concerns over missing funds, prompting a police investigation, Mint reported.

According to the complaint filed by the Chief Accounts Officer of New India Co-operative Bank at the Dadar Police Station, the bank's ex-GM Hitesh Mehta, in his capacity as general manager, is accused of withdrawing a massive sum from the bank's accounts, taking advantage of his position.

The police mentioned that the investigation was initially conducted by the Dadar Police, who have since registered a First Information Report (FIR) under sections 316 (5) and 61 (2) of the BNS (Banking and Non-banking Services).

The EOW has since seized the details of the bank's books, which will undergo forensic auditing to ascertain the full scale of the fraud and determine the involvement of other individuals, if any, Mint reported. Earlier today, the Mumbai Police's EOW started investigating the irregularities in the New India Cooperative Bank.

On Friday, the bank's acting chief executive officer, Devarshi Ghosh, lodged a complaint against Mehta and others at the Dadar police station in central Mumbai for allegedly misappropriating the bank's funds. Based on the complaint, the police registered a case early on Saturday morning, which was then transferred to the EOW for an in-depth investigation.

According to the complaint, Mehta and his other associates hatched a conspiracy and embezzled Rs 122 crore from the safes of Prabhadevi and Goregaon bank offices. A case under the Banking and Non-banking Services (BNS) sections 316 (5) (criminal breach of trust by public servants, bankers, and others in positions of trust), 61(2) (criminal conspiracy) was registered

During the police investigation, it became clear that the funds had been misappropriated soon after the Covid-19 pandemic broke out. While the accused embezzled Rs 112 crore from the Treasury safe in Prabhadevi, Rs 10 crore was siphoned off from the Goregaon branch.