PNB fraud: ED attaches Nirav Modi group's property worth Rs 523cr

Alicia Cross
February 26, 2018

The bank also denied reports that it has engaged audit firm PricewaterhouseCoopers (PwC) to investigate the Rs 11,400 crore fraud committed on the state-owned lender by diamond jeweller Nirav Modi and his associates.

The Indian Express has quoted an official saying the agency "want (s) to see on what basis these loans were granted and whether these are still recoverable".

Last week, the banking sector was rocked by major financial frauds - involving Rs 11,300 crore by diamantaire Nirav Modi and Rs 3,695 crore by Rotomac owner Vikram Kothari - surfaced in which the CBI has filed cases and made several arrests. Under Mudra, the rate of interest of the loans is relatively low compared to other loans and the borrower is not required to submit collateral to banks at the time of availing the loan facility.

Besides them, the CBI has also named 10 other directors and officials as accused in the scam.

"I will face my destiny and I know I have done nothing wrong and ultimately the truth shall prevail", Choksi said in a letter released by his lawyer Sanjay Abbot, expressing fear of safety for himself and his family due to the "unfair treatment, investigation, media frenzy and political statements".

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Sources reportedly said that a lot of these loan accounts are in the category of special mention account of second category, which means they are close to becoming NPAs (non-performing assets).

Mehta replaced Usha Ananthasubramanian as managing director and chief executive of Punjab National Bank in May 2017. The first source said other checkpoints that banks have been asked to comply with included setting a limit on payment instructions on Swift where the beneficiaries were individuals, and putting an additional layer of security on transactions beyond a certain threshold.

The Central Bureau of Investigation (CBI) and the Enforcement Directorate (ED) have registered two FIRs each to probe the case.

Auditors and the Reserve Bank of India have been under scrutiny over how they could have failed to detect a scam of such proportions. The information provided by him could be crucial in the case as he was allegedly in the direct contact of PNB officials in Mumbai as well as in the Delhi head office.

" Speaking at the ET Global Business Summit, he also said that the Indian industry now needs to seriously introspect about its responsibility to be ethical while doing business".

Other reports by Free-Prsite

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