PNB scam: Officials of BoI, Axis questioned

NEW DELHI: Widening its probe in the Rs 13,500-crore Punjab National Bank scam, the CBI has started questioning senior officials of other banks that 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 GM and above ranks, who handled international operations and finance, were called for questioning for the past two days and asked why they didn't raise an alarm about frequent issuance of LoUs and FLCs and with a deadline up to 360 days, which were in contravention of RBI guidelines. These officers supervised the operations of Bank of India-Antwerp branch, Axis Bank (Hong Kong) and Allahabad Bank (Hong Kong) from India. Officials said more officers of other banks would be called.

The CBI had found that two main co-conspirator PNB officials, Gokulnath Shetty and Manoj Kharat, and others had issued 293 LoUs and 224 FLCs to overseas branches of Indian banks in favour of Nirav Modi and his suppliers.