The Central Bureau of Investigation has registered a fresh case against three Gitanjali group companies of Mehul Choksi, the uncle of diamond merchant Nirav Modi, for causing an alleged ₹4,887-crore loss to Punjab National Bank. But confusion prevails over when the scam started.
Quoting the FIR, an agency official on Friday said the transactions under scrutiny took place in 2017-18. However, the CBI spokesperson clarified that as alleged by the bank, fraudulent transactions of ₹11,500 crore had been initiated in 2011 and the alleged fraud continued till this financial year.
Bank officials’ role
The CBI is also questioning four bank officials, Chief Manager Bechu B. Tiwari, Deputy General Manager Sanjay Prasad, Chief Manager (Zonal Audit Office) Mohinder Sharma and accused Manoj Kharat, in connection with the latest case.
While the FIR against Mr. Choksi involves ₹4,887 crore, the rest of the transactions are now part of the first FIR registered against Nirav Modi, his wife, brother and uncle on January 31.
In all, 293 fraudulent Letters of Undertaking (LoU) and 224 Foreign Letters of Credit (FLC) were generated since 2011.
The Nirav Modi fraud could end up wiping out at least ₹8,200 crore of Punjab National Bank finances, according to the latest estimates made available to the government by bank authorities on Friday. As estimated now, the bank has almost ₹8,200 crore of “outstanding buyer’s credits” linked to the accounts of various firms operated by Mr. Modi and his uncle.
Not in CBS system
A senior official said the PNB would have to pay this amount off from its finances. This amount was never captured in the core banking software of the bank. The government would have to provide a bailout for the pay-off to ensure that consumer confidence in the financial system was not shaken, he said.
Officials also disclosed that Mr. Modi and his firms had been under the scanner of not just the Income Tax Department, the Enforcement Directorate and of late the CBI. A list of top bank fraud cases that the Reserve Bank of India submitted to the Supreme Court last year contained his name.
26 locations searched
In the case against Mr. Choksi, the agency on Friday searched 26 locations in Mumbai, Pune, Surat, Jaipur, Hyderabad and Coimbatore. It also seized some diamonds from a Surat factory that were handed over to the ED.
The latest FIR names Mr. Choksi, his companies Gitanjali Gems, Gili India and Nakshatra Brand Ltd., their directors and two PNB officials Gokulnath Shetty (now retired) and Manoj Kharat as accused.
Mr. Choksi flew out of the country on January 4, while Mr. Modi, his wife and brother left by January 6. The CBI has got Interpol diffusion notices issued to determine their current whereabouts.
The three accused companies have 36 subsidiaries — 17 in Mumbai, one in Hyderabad, and the rest abroad.
