Builder-bank Nexus: CBI Registers 22 New Cases, Searches 77 Locations in 8 States, UTs

Moneylife Digital Team 14 April 2026

Economy & Nation

Central bureau of investigation (CBI) has intensified its crackdown on the alleged nexus between real estate developers and financial institutions, registering 22 fresh cases and conducting coordinated searches at 77 locations across eight states and Union Territories (UTs).

The action, carried out on the directions of the Supreme Court, forms part of a wider probe into large-scale cheating of home-buyers, many of whom were left paying equated monthly instalments (EMIs) for flats that were never delivered.

According to the agency, the searches led to the seizure of incriminating documents, digital devices and other materials, which are now being examined to uncover a broader conspiracy involving diversion of funds, financial irregularities and fraudulent practices in the housing sector.

With the latest cases, the total number of first information reports (FIRs) registered by CBI in connection with the Supreme Court-monitored investigation has risen to 50. The agency had earlier registered 28 cases, which are now in the final stages of investigation.

The probe stems from judicial intervention triggered by complaints from thousands of homebuyers in the National Capital Region (NCR), who alleged collusion between builders and banks under controversial interest subvention schemes. These schemes allowed developers to market projects by promising to service EMIs on behalf of buyers until possession, while banks disbursed a substantial portion of loans directly to builders.

However, when several projects stalled around 2018–19, developers defaulted on their commitments, leaving buyers burdened with loan repayments despite not receiving possession of their homes.

Taking serious note of the situation, the Supreme Court had earlier observed that home-buyers were being held 'to ransom' and flagged a possible 'unholy nexus' between builders and financial institutions. The Court also criticised banks for disbursing up to 70%–80% of sanctioned loans without verifying construction progress, in violation of the Reserve Bank of India’s (RBI's) 2013 guidelines.

In May 2025, while examining projects linked to Supertech Ltd, the apex court ordered a preliminary enquiry by CBI into loans worth about Rs5,000 crore extended under such schemes in NCR projects spanning Noida, Greater Noida, Gurugram and nearby regions.

The Court subsequently directed the formation of a special investigation team (SIT) within CBI, supported by officers from Uttar Pradesh and Haryana, and mandated coordination with multiple agencies, including RBI, the Union housing ministry and local development authorities.

By September 2025, after completing a series of preliminary enquiries, CBI informed the Court that it had found material evidence of cognisable offences. The Supreme Court then directed the agency to proceed with registering criminal cases wherever offences were made out, marking a shift from preliminary investigation to full-fledged prosecution.

The case also involves scrutiny of systemic irregularities in subvention loan schemes between 2013 and 2015, where banks allegedly released funds without ensuring project milestones, exposing buyers to financial risk. Many of the developers under investigation are currently undergoing insolvency proceedings under the Insolvency and Bankruptcy Code, complicating recovery efforts for affected buyers.

In earlier hearings, the Supreme Court had also restrained coercive recovery proceedings against homebuyers, offering them interim relief while investigations continue.

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Comments

User

triumph0511

2 months ago

The Hon SC must appoint the committee of the competent, upright and experts personnel which will guide the CBI and other investigating agencies in the investigation. There must be active involvement of the public servants, politicians, builders and bureaucrats in the financial scam. The probe should be completed in the time' bound manner and all perpetrators of the crime should be brought to justice irrespective of any kind of pressure from the government. Hope the gullible buyers get the justice at the earliest.