PNB scam fallout: As ordered, Allahabad Bank divests Chief Executive Usha Ananthasubramanian of all powers

Mumbai: The Board of state-owned Allahabad Bank on Tuesday divested its MD and Chief Executive Usha Ananthasubramanian of all powers with immediate effect, following a directive from the finance ministry, issued after she was named in the Central Bureau of Investigation's (CBI) chargesheet in the Punjab National Bank (PNB) fraud case.

Ananthasubramanian was the CMD of Punjab National Bank till May 2017.

Representational image. Reuters.

Representational image. Reuters.

"...the Board of Directors of the Bank in its meeting held on date has decided that Smt Usha Ananthasubramanian, MD & CEO be divested of all functional responsibilities of the Bank with immediate effect...," Allahabad Bank said in a regulatory filing.

It further asked the government to make suitable arrangements for smooth functioning of the bank.

Meanwhile, PNB on Tuesday said that its total liability on account of the fraud allegedly carried out by jewellery designer Nirav Modi and associates works out to Rs 14,356.84 crore

On Monday, the finance ministry had asked the boards of Allahabad Bank and PNB to take action against Ananthasubramanian and two executive directors of PNB. The PNB had on Monday divested its two executive directors of all powers.

The CBI on Monday filed its first chargesheet in the PNB fraud case detailing the roles of Nirav Modi, his brother Nishal Modi and Subhash Parab, an executive in Nirav Modi's company.

The mega PNB fraud was detected at the lender's Brady House branch in Mumbai involving certain accounts under the 'gems and jewellery' sector wherein, through apparent connivance between "these entities and few employees of the bank", some LoUs/FLCs were issued fraudulently to certain overseas branches of Indian banks via a misuse of the SWIFT messaging system.

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Updated Date: May 15, 2018 20:39 PM

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