Mumbai police have arrested Pawan Amarsingh Jaiswal, a building material supplier, from Lucknow in connection with the ₹122-crore New India Co-Operative Bank embezzlement case. Jaiswal, 47, a resident of Chakradharpur in West Singhbhum district, Jharkhand, was apprehended from his hideout in Lucknow on Saturday morning. He is accused of receiving ₹3.5 crore from the embezzled amount. The arrest was made by the Economic Offences Wing (EOW).

The New India Cooperative Bank fraud case surfaced in February after a surprise audit by the Reserve Bank of India (RBI) revealed that ₹122 crore had been misappropriated from the bank's cash reserves. The EOW has since registered several FIRs and is investigating a complex web of financial irregularities committed by the bank.

The EOW is probing over 2,000 suspect loans and Non-Performing Assets (NPAs) worth ₹400 crore. The bank's former general manager (accounts), Hitesh Mehta, and former chief executive officer, Abhimanyu Bhoan, are already in custody for their roles in the alleged embezzlement. Hitesh Mehta was remanded to police custody until February 21 in connection with the alleged misappropriation. Hitesh Mehta, the key accused in the case, was scheduled to undergo a brain-mapping test.

The investigation has also revealed that the Percept Group, an entertainment, media, and communications conglomerate, had taken a ₹77-crore loan from the New India Cooperative Bank. Senior bank officials allegedly waived ₹18.56 crore of this loan and accepted ₹6.37 crore in kickbacks for declaring the loan as a Non-Performing Asset (NPA). The EOW alleges that the loan was sanctioned to Percept without due diligence and that the offenses occurred between September 2014 and October 2023. Three senior executives of the Percept Group have been booked in connection with the case for alleged loan irregularities and providing kickbacks to senior bank officials.

Further investigation revealed that Hiren Bhanu, son of the bank's co-founder Rajni Bhanu, was seen removing cash from the reserves and re-depositing it after some time. Mehta confessed to giving Bhanu ₹22 crore from the ₹122 crore he allegedly removed from the cash vault. Bhanu and his family allegedly fled the country before the fraud surfaced in February. Hiren Bhanu, a British national, reportedly fled to Abu Dhabi on January 26, while his wife and sons left later. Look out circulars have been issued against them, and a blue corner notice was issued through Interpol.