Lucknow Court Convicts Three in Rs 3 Crore Bank Loan Fraud Case

New Delhi, Jul 3 (PTI) A special court under the Prevention of Money Laundering Act (PMLA) in Lucknow has found three individuals guilty in a case of money laundering tied to a bank loan fraud exceeding Rs 3 crore. The court has also mandated the confiscation of assets worth Rs 16 lakh that were attached by the Enforcement Directorate (ED) during their investigation.

The order was delivered on June 30 by Special Judge Rahul Prakash.

The ED's investigation, launched under the PMLA framework, originates from a 2006 FIR filed by the CBI against the late Amarnath Sahu and others. Sahu was the manager of the Allahabad Bank's Jankipuram branch in Lucknow between September 15, 2003, and December 10, 2005.

According to the CBI, Sahu approved overdrafts and loans based on "fake" documents, bypassing standard banking protocols. An internal inquiry by the bank quantified the loss at Rs 3.20 crore, per case documents obtained by PTI.

The ED initiated their criminal proceedings under the PMLA in 2010 and formally charged the accused in October 2017, with the charges being framed in September 2024.

The court has convicted three individuals — Saurabh Sahu, Ashwani Kumar, and Mamta Sinha — under various sections of the PMLA for money laundering offenses.

With Amarnath Sahu having passed away during the trial, proceedings against him have been abated, according to the court's order.

The three convicted parties have been sentenced to three years of incarceration alongside a fine of Rs 50,000 each. Failure to pay the fine will result in an additional six months of imprisonment.

Furthermore, the court has ordered the confiscation of immovable assets valued at Rs 16,42,248. These properties, owned by Mamta Sinha, had been seized by the ED during their probe, as outlined in the court order.