Shivamogga Police arrest two people who cheated banks by pledging fake gold to take loan
Shivamogga police have arrested two individuals for defrauding multiple banks by pledging fake gold-coated jewelry as collateral for loans. The gang successfully obtained ₹28 lakh by exploiting banks that relied solely on basic acid tests for verification.
Why it matters
This highlights significant vulnerabilities in banking security protocols regarding collateral verification and the potential for organized financial fraud.
Shivamogga police have arrested two persons on charges of cheating several banks after obtaining loans amounting to ₹28 lakh by pledging gold-coated (fake) jewellery.
The arrested have been identified as Lokesh, 39, of Bilmane Arekallu village in Tirthahalli taluk, and Sudha of Malavagoppa in Shivamogga. Three others involved in the case — S.Y. Ravi Shankar, Rahul and Sharath — are absconding.
Shivamogga SP B. Nikhil, on Saturday, told the media that Doddapete police had investigated the case after receiving a complaint from the branch manager of Punjab National Bank on July 3. The accused had pledged jewellery at the bank to obtain a loan of ₹7.62 lakh, but failed to repay it. When the jewellery was due to be auctioned, bank officials discovered that it contained only 10% gold.
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