Troubled Punjab National Bank (PNB) has detected a small fraud at the Mumbai branch that is at the centre of the Rs 13,600 crore scam being probed by Indian authorities, according to a media report.
A Reuters report, which cited a Central Bureau of Investigation (CBI) complaint, said the new alleged fraud, amounting to around Rs 91 million, involves officials of a company called Chandri Paper and Allied Products Pvt Ltd. Further details about the new fraud are not available at the moment.
PNB logo. Reuters
On Wednesday, Reserve Bank of India (RBI) governor Urjit Patel, breaking his silence on the Rs 13,600 crore PNB fraud, said that the central bank's regulatory authority over public sector banks was weaker than that over the private sector banks. Governor Patel, speaking at an event organised at the National Law University in Gandhinagar, added that RBI data on banking frauds suggests that only a handful of cases over the past five years have had closure, and cases of substantive economic significance remain open.
"As a result, the overall enforcement mechanism - at least until now – is not perceived to be a major deterrent to frauds relative to economic gains from fraud," said Patel whose full speech has been put up on the RBI's website.
Earlier in the week, former RBI boss Raghuram Rajan said that the central bank had no clue about the Rs 13,600 crore PNB scam and that the RBI could have stopped it had it known about it.
The Rs 13,600 crore PNB scam was allegedly masterminded by billionaire diamantaire Nirav Modi and his maternal uncle Mehul Choksi, who owns, Gitajali Gems. The duo colluded with a few staffers working at PNB's Brady House branch, in south Mumbai, to obtain unauthorised and unmonitored letters of undertaking (LoUs) to commit fraud.
Published Date: Mar 15, 2018 11:40 AM | Updated Date: Mar 15, 2018 11:40 AM