Hyderabad: How USFB’s employees manipulated loan process to siphon off ₹70 Cr

Hyderabad: Hyderabad Central Crime Station (CCS) has booked five employees of Unity Small Finance Bank for allegedly siphoning off nearly Rs 70 crore by manipulating the loan process and repayment records.

A case was registered following a complaint filed by the bank’s representatives after internal discrepancies came to light.

Fraud spanned two years

The Delhi-headquartered bank operates its South Zonal Office on Raj Bhavan Road in Hyderabad. According to officials, the fraud took place between 2023 and 2025 and involved irregularities in loan approvals and monthly recovery processes.

Senior officials named in case

Those named in the case include Regional Loan Management Manager Basam Nikhilesh Reddy; Area Business Managers Kiran Lingam, Sheikh Arshad Mohammed, and Ajay Nevatia; and Relationship Manager Sai Shravan Kumar. All of them were entrusted with responsibilities related to loan processing and monitoring.

Login credentials misused, fake loan clearances

As per the complaint, the accused allegedly accessed and misused the bank’s internet login credentials to sanction loans to unauthorised individuals.

In several instances, loan instalments that were not actually paid were falsely shown as cleared in the system. Investigators said the accused routed installments through financiers into certain loan accounts and later withdrew the same funds.

Funds diverted to relatives, assets accumulated

The siphoned money was allegedly diverted to relatives and associates, enabling the accused to accumulate substantial assets. It was also found that loans were sanctioned without proper verification of pledged collateral properties, exposing the bank to significant financial risk.

₹70 crore misappropriated

Preliminary findings indicate that Kiran Lingam allegedly diverted Rs 10.14 crore linked to 271 loan accounts, while Sheikh Arshad Mohammed is accused of misappropriating Rs 59.94 crore across 767 accounts. Together with the other accused, the total fraud amount is estimated at Rs 70 crore.

Irregularities found in Internal Audit

The irregularities surfaced during an internal audit conducted by the bank. Based on its findings, a formal complaint was lodged with the CCS, which has now launched a detailed investigation into the transactions and the assets acquired by the accused. Further probe is underway.