On wednesday the CBI exhumed a scam linked to the Pradhan Mantri Awas Yojana(PMAY) and registered a case against the promoters of crisis-hit Dewan Housing Finance Limited (DHFL), Kapil and Dheeraj Wadhawan in connection with the criminal conspiracy. 

It has been alleged that they had opened counterfeit home loan accounts amounting to over Rs 14,000 crore and availed Rs 1,880 crore in interest subsidy from the Government of India.

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The Pradhan Mantri Awas Yojana scheme was launched by the government of India, managed by the ministry of housing in 2015 to boost the affordability of houses against an inflated real estate sector. 

Four primary features of this schemes are:

  • Credit Linked subsidy scheme (CLSS)
  • "In-situ" slum redevelopment (ISSR) using the land as a resource
  • Affordable Housing in Partnership (AHP)
  • Individual house construction or enhancement led by beneficiaries 

Under the scheme, housing loans are granted to people from economically weaker sections (EWS), low-income group (LIG), middle-income group (MIG I) (MIG II), scheduled caste, scheduled tribe, and other backward class are eligible for credit-linked interest subsidy, which varies from 3% to 6.5% per annum. 

The subsidy is to be claimed by financing institutions like DHFL, that have granted these loans. 

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"In total, 2.6 lakh fake and fictitious home loan accounts were created in the non-existent Bandra branch between 2007 and 2019 for a total loan amounting to ₹14,046 crore, of which ₹11,755.79 crore was deposited/routed to several fictitious firms known as Bandra Book Firms," CBI said in the FIR citing the forensic audit report.

Further, it stated, several of these bogus loan accounts were allegedly opened in the PMAY to claim interest subsidies from the National Housing Bank in connivance with its officials and thus committed fraud on the government exchequer.  

Since November 2019, after its multiple irregularities came to light, the scam-hit financial firm has been under the control of the reserve bank of India through an administrator.