Retirement fund manager EPFO has decided to suspend further investments in LIC Housing Finance till the CBI completes investigations into the alleged involvement of its top official in the bribe-for-loan scam.
“As of now we have suspended further investments in LIC Housing Finance. Safety of fund is our prime concern. We are doing so because CBI is investigating the case,” the Labour Minister, Mr Mallikarjun Kharge, said.
Mr Kharge, who was speaking after a meeting of the Central Board of Trustees — the highest policy making body of the Employees Provident Fund Organisation (EPFO) — said the EPFO will not invest in LIC Housing Finance till the CBI inquiry is over.
LIC Housing Finance is the subsidiary of LIC, the largest insurance company in India
The EPFO till date has invested Rs 454 crore in the bonds of LIC Housing Finance, while the current investment norms allow investment up to Rs 846 crore. The EPFO, which can invest an additional Rs 392 crore in the housing finance company, says it will n ot do so until the probe in the housing finance racket is completed.
Last month, the CBI arrested the LIC Housing Finance CEO, Mr Ramachandran Nair, and seven others senior bankers for allegedly colluding with real estate firms to sanction large-scale corporate loans, by overriding mandatory conditions for such approvals along with other irregularities.
Apart from Mr Nair, Mr Naresh K. Chopra, Secretary (Investment), LIC; Mr R.N. Tayal, General Manager of Bank of India (Delhi); Mr Maninder Singh Johar, Director (chartered accountant) of Central Bank of India, and Mr Venkoba Gujjal, Deputy General Manage r of Punjab National Bank (Delhi), were also arrested.
Besides, Mr Rajesh Sharma, CMD of Mumbai-based firm Money Matters Ltd, and two other company employees — Mr Suresh Gattani and MR Sanjay Sharma — were also arrested by the CBI.
LIC Housing Finance, however, maintained that all the necessary procedures were followed by it while approving loans.
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