Exclusive: MP college, bank officials ‘colluded to pocket govt scholarships for MBA students who never applied’

The case came to light following a complaint filed by Lokesh Kumar, Deputy General Manager and Zonal Head of UCO Bank, Bhopal, alleging irregularities in the opening and operation of 118 bank accounts at the Habibganj branch. Acting on the complaint, the CBI initiated a preliminary enquiry, which, according to the FIR, revealed that the accounts had allegedly been opened in the names of MBA students without their knowledge or consent. Government scholarship amounts were then credited into these accounts and withdrawn before the beneficiaries could access them.

“During the period from 01.01.2020 to 31.10.2021, 118 fraudulent bank accounts were opened in Habibganj Branch of UCO Bank in the name of various persons, and scholarship worth Rs 99.48 lacs were credited into these accounts granted by the government, which was misappropriated by unknown persons,” the CBI FIR read.

Investigators allege that the fraud relied on control over the accounts from the time they were opened. According to the FIR, the college officials allegedly arranged for the accounts to be opened, linked their own or their associates’ mobile numbers to the accounts, collected the respective ATM cards, and used them to withdraw the scholarship money.

The CBI has named six people as accused in the case, including Prema Verma, the then Senior Manager of UCO Bank’s Habibganj branch. The others are Vinay Malhotra, director of the Academy of Management College, Bhopal; professor Aditya Malhotra; assistant professors Manoj Jain and Vinesh Meshram; and Ram Singh Verma, who was employed by the college at the time. The FIR also names “unknown others”.

When contacted, Malhotra, who was also the chairperson of the college’s Internal Complaints Committee, said, “The bank officials were involved in this, and my name came up now in the CBI investigation.” The other accused are yet to respond to the allegations.

When reached for a comment, a college representative said this is a matter between bank representatives in which the college administration has been roped in. There are no irregularities in the scholarship scheme, and the college administration is cooperating with the authorities, they said.

The modus operandi

According to the FIR, account-opening forms were allegedly prepared with forged signatures and false personal details, and mandatory Know Your Customer (KYC) verification was bypassed. Documents submitted to support the applications – including bona fide certificates purportedly issued by the college – were later found to be fabricated during scrutiny.

The CBI alleged that instead of being handed over to the students, debit cards for the accounts were allegedly issued and delivered to a single individual, Ram Singh, without any written authorisation from the account holders. By linking their own mobile numbers to the accounts, the accused allegedly received one-time passwords (OTPs), enabling them to withdraw scholarship funds almost immediately after they were credited.

The CBI has also accused Verma, the then Senior Manager of UCO Bank’s Habibganj branch, of facilitating the operation despite being responsible for ensuring compliance with banking rules governing account opening, KYC verification, system checks and ATM issuance. The CBI alleged that she processed the accounts in gross violation of banking norms and acted in criminal conspiracy with the college authorities.

According to the FIR, the enquiry found prima facie evidence that the scholarship money was usurped through forged documents and fraudulent banking processes, with bank officials allegedly facilitating the operation at every stage by disregarding mandatory procedures.

The CBI has invoked charges of criminal conspiracy, cheating, forgery and using forged documents under the Indian Penal Code, along with provisions of the Prevention of Corruption Act. The investigation has been assigned to Inspector Nazim Khan of the CBI’s Anti-Corruption Branch in Bhopal and is expected to examine whether others were involved in the alleged diversion of scholarship funds and whether similar practices were followed in other accounts.