ICICI Loan Fraud Case Explained: Journey of Chanda Kochhar from being the first woman CEO of an Indian bank to going behind bars

Chanda Kochhar Case: Kochhar, 59, quit the position of CEO and MD of ICICI Bank in October 2018 after the allegations. During her retirement, Kochhar had 6,90,000 shares of the bank through ESOPs.

Chanda Kochhar Case: All three accused have been arrested and the hearing will resume after the court opens in January (Image: Reuters and official page of ICICI Bank)

Chanda Kochhar news: The Bombay High Court has refused an urgent hearing requested by former ICICI Bank CEO Chanda Kochhar. She and her husband Deepak Kochhar were arrested by the Central Bureau of Investigation (CBI) on Friday for alleged loans issued to the Videocon Group's Venugopal Dhoot. While the arrest has stirred a hornet's nest in the financial sector with Kochhars claiming that they have been framed, the Court has refused to give any interim relief.

Here is what you need to know about the case and what led to such a controversy:

1. Who is Chanda Kochhar?

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Chanda Kochhar joined ICICI Bank in 1984 as a management trainee and gradually became one of the core members responsible for establishing the bank. Kochhar became the bank's managing director in 2009 and its Chief Executive Officer — the first CEO of any Indian bank. She was often counted among the top Indian women bankers at a time when banking was primarily considered to be a male-dominated sector. She also received the Padma Bhushan Award in 2011 for her work in the financial sector.

2. Chanda Kochhar case: What is the controversy all about?

The root of the controversy can be traced back to 2010 when Chanda Kochar was the CEO of the bank. Kochhar, along with her husband and Videocon Group promoter Venugopal Dhoot have been arrested by the CBI. As mentioned by the CBI, credit facilities of around Rs 3,250 crore were sanctioned to Videocon group companies while Kochhar was the CEO, but that sanctioning of such a lump sum amount was a violation of RBI rules and the ICICI Bank’s credit policy.

CBI has alleged that six loans were disbursed by ICICI Bank to Videocon Group and its associated firms between 2009 and 2011 during Kochhar’s tenure. She was a part of the committees that sanctioned the two major loans, worth Rs 300 crore and Rs 750 crore. The matter further got complicated as the CBI alleged that the Videocon group transferred a part of the sanctioned loans to Deepak Kocchar’s company.

As per CBI's allegations, Videocon’s Dhoot had invested Rs 64 crore in Deepak Kochhar’s Nupower Renewables and allegedly made this investment through a company Supreme Energy Pvt Ltd (SEPL), which he transferred to Deepak Kochhar-managed Pinnacle Energy Trust. The transfers happened from 2010 to 2012. As per the CBI's information, the transfer of Rs 64 crore to Nupower happened a day after the loan worth Rs 300 crore was disbursed in September 2009.

Although ICICI Bank previously claimed that the loan was disbursed as per the guidelines of the bank and supported Kochhar, but she had to resign in 2018 when the case blew up. It was even alleged that most of these loans turned into non-performing assets.

Kochhar, 59, quit the position of CEO and MD of ICICI Bank in October 2018 after the allegations. During her retirement, Kochhar had 6,90,000 shares of the bank through ESOPs.

3. Chanda Kochhar case: When did the controversy begin?

A preliminary enquiry was initiated against Deepak Kochhar and Dhoot in March 2018 to probe alleged irregularities in the Rs 40,000 crore loans issued in favour of the Videocon Group.

In the same year (2018), the capital markets regulator, SEBI issued a show-cause notice to ICICI Bank and her violating regulations 4(1)(h) and 5 of the Sebi (Listing Obligations Disclosure Requirement) Regulations, 2015.

In August 2021, the Enforcement Directorate (ED) submitted draft charges against the couple and the other accused in a special PMLA court in connection with a money laundering case. The ED had arrested Deepak Kochhar in September 2020. Although, there were arrest warrants against Chanda Kochhar and Dhoot, but they had been granted bail by the special PMLA court in February and March, respectively in 2021.

4. Chanda Kochhar case: What happens now?

The court has directed the couple to approach it for a regular hearing on January 2 and their appeal to an urgent hearing has been turned down by the court. The hearing will resume after the vacation.

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