MUMBAI: The extent of the unravelling fraud at state-run Punjab National Bank could upward thrust past the nearly $2 billion mark (Rs 12,700 crore) up to now outlined by way of the lender, according to a supply involved within the probe and court paperwork reviewed by way of information agency Reuters.
The supply, who requested to not be named, said investigators had no longer but recovered all of the papers and mortgage promises allegedly issued by way of rogue workers of the bank, and consequently believed the bank's exposure could be greater than printed up to now.
In what has been dubbed the biggest fraud in India's banking historical past, Punjab National Bank (PNB) and police have accused two jewellery groups - one managed by way of diamond mogul Nirav Modi and the opposite by way of his uncle Mehul Choksi - of colluding with bank workers to get credit score from out of the country banks the use of fraudulent promises.
Both Choksi and Modi have denied the allegations and legal professionals for the two key accused PNB workers within the case have also said they're blameless.
According to court filings, the exposure to three corporations managed by way of Modi has been estimated at Rs 64.98 billion ($1 billion), while corporations managed by way of Choksi have been accused of defrauding the bank of Rs 61.38 billion.
The Central Bureau of Investigation (CBI) has instructed a Mumbai court that the volume involving Modi's corporations used to be prone to go up, according to the supply and court filings, copies of that have been reviewed by way of Reuters.
The CBI instructed the court that its investigation had discovered that the fraudulent issuance of letters of endeavor (LoUs), or promises, thru a Mumbai branch of the bank were happening since 2010.
In papers filed on Monday, the CBI also said PNB didn't have all of the paperwork related to the LoUs, since those have been returned to the borrower.
"Most of these documents are not yet recovered. The size of the fraud has now gone (up)...and the same is likely to go even higher," the CBI said within the court filing.
PNB didn't respond to requests on Tuesday in search of remark on the possibility of its exposure emerging further.
The bank first of all reported to authorities on January 29 that the jewelry groups had defrauded it of Rs 280 crore. On February 14, it said the fraud sum had reached over Rs 11,000 crore after a detailed investigation.
It raised the volume further to just about Rs 12,700 crore closing week, pronouncing it had found out some $200 million extra in fraudulent letters of credit score, some other form of credit score ensure, issued to Choksi's Gitanjali team.
Investigators widened their probe on Tuesday with the government's Serious Fraud Investigation Office beginning to call senior executives from Gitanjali's creditor banks for questioning over their mortgage exposure, separate resources with direct wisdom of the probe said.
Police also arrested on Tuesday Vipul Chitalia, a vice president at Gitanjali, taking the total choice of other folks arrested up to now within the case to 19. Chitalia, who police say used to be the authorised signatory for Gitanjali for the allegedly fraudulent transactions, used to be detained by way of Indian immigration authorities on his arrival from Bangkok.
Jeweller Modi at the side of his family left India in January before PNB filed a police complaint, according to police, who also say Choksi is out of India. Their whereabouts are not known.
PNB stocks fell 2.three according to cent on Tuesday in a Mumbai marketplace that slipped 1.1 according to cent. The inventory has lost virtually 40 according to cent of its marketplace worth since disclosing the fraud on February 14.
Finance minister Arun Jaitley instructed parliament on Tuesday that PNB had "sound fundamentals and strong growth potential" with its high proportion of low-cost current and financial savings accounts deposits, stabilising dangerous loans and scope to boost finances by way of selling non-core belongings.
Axis Bank, a private sector lender, said in a inventory exchange filing the Serious Fraud Investigation Office had sought data from it on the accounts of Nirav Modi and Gitanjali groups of companies, including its exposure to both groups used to be about Rs 2 billion.
The supply, who requested to not be named, said investigators had no longer but recovered all of the papers and mortgage promises allegedly issued by way of rogue workers of the bank, and consequently believed the bank's exposure could be greater than printed up to now.
In what has been dubbed the biggest fraud in India's banking historical past, Punjab National Bank (PNB) and police have accused two jewellery groups - one managed by way of diamond mogul Nirav Modi and the opposite by way of his uncle Mehul Choksi - of colluding with bank workers to get credit score from out of the country banks the use of fraudulent promises.
Both Choksi and Modi have denied the allegations and legal professionals for the two key accused PNB workers within the case have also said they're blameless.
According to court filings, the exposure to three corporations managed by way of Modi has been estimated at Rs 64.98 billion ($1 billion), while corporations managed by way of Choksi have been accused of defrauding the bank of Rs 61.38 billion.
The Central Bureau of Investigation (CBI) has instructed a Mumbai court that the volume involving Modi's corporations used to be prone to go up, according to the supply and court filings, copies of that have been reviewed by way of Reuters.
The CBI instructed the court that its investigation had discovered that the fraudulent issuance of letters of endeavor (LoUs), or promises, thru a Mumbai branch of the bank were happening since 2010.
In papers filed on Monday, the CBI also said PNB didn't have all of the paperwork related to the LoUs, since those have been returned to the borrower.
"Most of these documents are not yet recovered. The size of the fraud has now gone (up)...and the same is likely to go even higher," the CBI said within the court filing.
PNB didn't respond to requests on Tuesday in search of remark on the possibility of its exposure emerging further.
The bank first of all reported to authorities on January 29 that the jewelry groups had defrauded it of Rs 280 crore. On February 14, it said the fraud sum had reached over Rs 11,000 crore after a detailed investigation.
It raised the volume further to just about Rs 12,700 crore closing week, pronouncing it had found out some $200 million extra in fraudulent letters of credit score, some other form of credit score ensure, issued to Choksi's Gitanjali team.
Investigators widened their probe on Tuesday with the government's Serious Fraud Investigation Office beginning to call senior executives from Gitanjali's creditor banks for questioning over their mortgage exposure, separate resources with direct wisdom of the probe said.
Police also arrested on Tuesday Vipul Chitalia, a vice president at Gitanjali, taking the total choice of other folks arrested up to now within the case to 19. Chitalia, who police say used to be the authorised signatory for Gitanjali for the allegedly fraudulent transactions, used to be detained by way of Indian immigration authorities on his arrival from Bangkok.
Jeweller Modi at the side of his family left India in January before PNB filed a police complaint, according to police, who also say Choksi is out of India. Their whereabouts are not known.
PNB stocks fell 2.three according to cent on Tuesday in a Mumbai marketplace that slipped 1.1 according to cent. The inventory has lost virtually 40 according to cent of its marketplace worth since disclosing the fraud on February 14.
Finance minister Arun Jaitley instructed parliament on Tuesday that PNB had "sound fundamentals and strong growth potential" with its high proportion of low-cost current and financial savings accounts deposits, stabilising dangerous loans and scope to boost finances by way of selling non-core belongings.
Axis Bank, a private sector lender, said in a inventory exchange filing the Serious Fraud Investigation Office had sought data from it on the accounts of Nirav Modi and Gitanjali groups of companies, including its exposure to both groups used to be about Rs 2 billion.
PNB fraud likely to swell beyond $2 billion mark
![PNB fraud likely to swell beyond $2 billion mark]()
Reviewed by Kailash
on
March 07, 2018
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