Diversion of Funds and Siphoning of Funds
Oct26

Diversion of Funds and Siphoning of Funds

What is Diversion of Funds? Diversion of Funds means (mis)utilization of Funds for a purpose for which loan was not sanctioned. Most common example is buying immovable property out of the Cash Credit Limit, which is being sanctioned for working capital purposes.   Utilisation of short-term working capital funds for long-term purposes not in conformity with the terms of sanction; Deploying borrowed funds for purposes / activities...

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