NEW DELHI: Widening its probe in the Rs 13,500 crore
Punjab National Bank scam, the
CBI has now started questioning senior officials of other banks which sanctioned credit to
Nirav Modi and Mehul Choksi on the basis of Letters of Undertaking (LoUs) and Foreign Letters of Credit (FLCs) issued by PNB’s
Brady House branch.
Sources said five officers of general manager and above ranks, who handled international operations and finance, were called for questioning in the past two days and asked why they didn’t raise an alarm about frequent issuance of LoUs and FLCs.
These officers supervised the operations of Bank of India - Antwerp branch, Axis Bank (Hong Kong) and Allahabad Bank (Hong Kong) from India.
Officials added that more officers belonging to other banks would be called soon.
CBI had found that two main co-conspirator PNB officials,
Gokulnath Shetty and Manoj Kharat, and others had issued 293 LoUs and 224 Foreign Letters of Credit (FLCs) to overseas branches of Indian banks in favour of Nirav Modi and his suppliers.
These were issued to State Bank of India’s Mauritius and Frankfurt branches, Bank of India’s Antwerp Branch, Canara Bank’s Bahrain branch and Axis Bank’s Hong Kong branch.
The PNB officials omitted entries of LoUs in the core banking system issued on the behalf of Nirav Modi’s companies to avoid detection. The funds raised through the LoUs were meant to be used for the payment of import bills of Modi’s companies whereas it was utilised for discharging the earlier liabilities on account of buyers credit facility allowed by the overseas branches of Indian banks, which was kind of a roll over of payments.
The bank officers used SWIFT, a global messaging service to raise buyers’ credit and funding of NOSTRO accounts, because if they made an entry in the core banking system (CBS), the audit team would have caught the anomalies.
CBI has found that there is no documentary evidence to prove that the import transactions are bonafide trade transactions and there are several discrepancies in LoUs which could have been easily detected by ordinary due diligence.
