M&M Finance Shares Drop 7% As Board Meeting Is Postponed Following Rs 150 Crore KYC Fraud

In order to examine its fourth-quarter results, M&M Finance has postponed its scheduled board meeting, which was originally set for April 23. This happened after the non-bank lender notified the exchanges late on Monday that one of the company’s offices in the Northeast had discovered a scam totaling Rs 150 crore.

The crime entailed the falsification of KYC paperwork pertaining to loans for retail vehicles, which led to the embezzlement of corporate cash.

The stock exchange was notified by M&M Finance that the fraudulent behavior resulted in the embezzlement of corporate cash. According to the exchange filing, the projected financial effect of this fraud is expected to be about Rs 150 crore. The organization has taken immediate action to implement the appropriate remedial measures in response to the issue.

The business has determined what has to be fixed and notified exchanges that some of the individuals involved have been taken into custody.

Additional topics on the agenda for the Audit Committee and Board Meeting on that day include talking about increasing the maximum amount that may be borrowed overall and issuing non-convertible debentures. The yearly earnings conference call has also been postponed.

The central fraud monitoring division of the Reserve Bank of India has also been informed about the issue. The business said that inquiries are currently under progress and have already started. The firm has determined what remedial action is required, and it is now implementing it in phases.

At 9:37 a.m. on Tuesday, shares of Mahindra & Mahindra Finance were trading 4.5% down at Rs 266.15. The share hit a seven percent intraday low. The non-bank lender’s stock has gained over 10% over the last year, but its performance has lagged behind that of most of its competitors.