The manager of the Circus Avenue branch of UCO Bank was arrested on Thursday for his alleged involvement in defrauding the state-run West Bengal Infrastructure Development Finance Corporation of Rs 120 crore.

“Senior branch manager Alois Lakra has been arrested on the basis of primary suspicion. We have come across certain facts that have made us believe he was involved in the case,” said Pallab Kanti Ghosh, joint commissioner, crime.

Corporation chairman Abhirup Sarkar, a professor at Indian Statistical Institute, met police commissioner Surajit Kar Purkayastha on Wednesday and lodged a complaint about the embezzlement.

A preliminary inquiry has revealed that the corporation, which funds infrastructure projects, had invested Rs 120 crore in fixed deposits in two instalments.

The first instalment of Rs 59 crore was paid to the bank in August last year and the second installment of Rs 61 crore in January.

The money was transferred to UCO Bank through real-time gross settlement (RTGS) from Indian Bank and Bank of India (BoI). The corporation had received certificates for the fixed deposits but those turned out to be fake.

“It is apparent that when the corporation had invited quotations from banks for the investment, Lakra had submitted a quotation on behalf of UCO Bank,” said an officer. “But the money seems to have been deposited in a fictitious account in the Circus Avenue bank and then transferred to some other accounts.”

Lakra was arrested when he came to office on Thursday morning. He has been remanded in police custody till March 18.