A Mumbai court on Tuesday extended the police custody of Punjab and Maharashtra Cooperative (PMC) Bank's former director Surjit Singh Arora, who was arrested in connection with the multi-crore scam in the bank, till October 24.
Mr Arora was arrested last week by Mumbai Police's Economic Offences Wing (EOW) in connection with the alleged scam.
He was produced before the metropolitan magistrate SG Shaikh, after his police remand ended on Tuesday. The court extended his police custody until Thursday.
Mr Arora is the fifth accused to be arrested in the Rs. 4,355 crore case.
Besides him, the EOW has arrested the bank's former managing director Joy Thomas, former chairman Waryam Singh, Housing Development Infrastructure Ltd's (HDIL) chairman and managing director Rakesh Wadhawan and his son Sarang Wadhawan in connection with the scam.
The EOW last week said Mr Arora was the director and key member of the loan committee of the bank until its affairs were taken over by the RBI. The HDIL group of companies were awarded credit facilities on a large scale, wherein the fraud occurred. The alleged fraud was "sheltered" by Mr Arora, it said.
The EOW also told the court that bank officials replaced 44 loan accounts of HDIL with 21,049 fictitious accounts to camouflage huge loan defaults by the real estate group which landed the bank in the current crisis. Surjit Singh Arora colluded with the other accused to aid the crime, the probing agency said.
"Mr Arora was elected on the directors' body to ensure proper functioning of the bank. However, he abused his official position to facilitate the fraud," it said.
The EOW earlier this month registered a case against the Wadhawans and top officials of the PMC Bank for allegedly causing losses to the tune of Rs. 4,355.43 crore to the bank.
After the scam was unearthed in the bank, which has deposits of over Rs. 11,000 crore, the Reserve Bank of India appointed an administrator over it, and capped its withdrawals at Rs. 40,000 per account for six months.