The Employees’ Provident Fund Organisation trustees today approved a proposal to resume investment in the scam-hit LIC Housing Finance, a subsidiary of the country’s largest insurance company Life Insurance Corporation.
The decision to resume investment in LIC Housing Finance was taken at the meeting of the Central Board of Trustees (CBT), the apex decision-making body of the EPFO.
The CBT had suspended investment in the housing finance company following disclosure of the bribe-for-loans scam in November 2010 in which the company’s top officials were allegedly involved.
“Amount invested in LIC Housing Finance is not much...approved investment is only about Rs 800 crore,” the CBT member and Secretary-All India Trade Union Congress, Mr D.L. Sachdev, told reporters after the CBT meeting.
The EPFO had invested Rs 454 crore in the bonds of LIC Housing Finance. The retirement fund manager’s prevailing investment norms allow for investment of up to Rs 846 crore in the company.
The EPFO’s advisory body, the Finance and Investment Committee (FIC), took up the issue at its meeting on January 28 and recommended resumption of investment in LIC Housing Finance.
LIC Housing Finance went through a bad phase after the Central Bureau of Investigation in November arrested its CEO Mr Ramachandran Nair and seven other senior bankers for allegedly colluding with real estate firms to sanction large-scale corporate loans, overriding the mandatory due diligence involved in such approvals, besides other irregularities.
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