Mahindra Finance shares drop 5.47% after fraud revelation

New Delhi: Mahindra Finance detected about Rs 150 crore fraud in its retail vehicle loan portfolio in one of its branches, leading to the deferment of its board meeting to approve the financial results for 2023-24.

Mahindra & Mahindra Financial Services board was scheduled to meet on Tuesday to approve the financial results for the March quarter and 2023-24.

In a regulatory filing, the company said a new date for the board meeting will be informed later.

Mahindra Finance said during the end of the fourth quarter of the financial year ended March 31, 2024, a fraud was detected at one of the company's branches in the northeast.

"In respect of retail vehicle loans disbursed by the company, the fraud involved forgery of KYC documents leading to embezzlement of company funds. The investigations in the matter are at an advanced stage. The company estimates that the financial impact of this fraud is unlikely to exceed Rs 150 crore," Mahindra Finance said.

Investigations are underway, and necessary corrective actions have been identified and are at various stages of implementation, including the arrest of a few persons involved, it added.

Shares of Mahindra Finance closed 5.47 per cent down at Rs 263.60 apiece on the BSE.