Fugitive jeweller Nirav Modi obtained his first fraudulent guarantee from the Punjab National Bank's (PNB) Brady House branch in Mumbai on 10 March 2011 and managed to get 1,212 more such guarantees over the next 74 months, finance minister Arun Jaitley said on Tuesday.
Companies linked to Nirav Modi obtained Letters of Undertaking (LoUs), which were used to get loans from overseas branches of Indian banks, up to five guarantees on a single day, with the help of rogue employees of the country’s second biggest state-run bank.
In a written reply to a question in the Rajya Sabha, Jaitley said the last fraudulent LoU was issued on 23 May 2017. During these six years, 53 genuine (non-fraudulent) LoUs were also issued to Nirav Modi Group — the first being on 5 March 2011 and last on 6 November 2017, he said.
The fraudulent LoUs had a validity of up to one year. Payments due in January this year were against LoU issued in February last year, he said, listing date-wise the LoUs issued.
Companies linked to Modi and his uncle Mehul Choksi defrauded PNB to the tune of Rs 13,600 crore. Choksi’s Gitanjali Group defrauded Rs 7,080.86 crore while the rest is attributed to companies of Modi.
Jaitley said “PNB Head Office received a report suspicious outstanding unauthorised transactions from Circle Office, Mumbai on 23 January 2018.” “Immediately an investigating team was constituted which gave its preliminary report on 25 January 2018.
On 29 January 2018 (26 to 28 January being public holidays), fraud was reported to RBI and complaint lodged with CBI Mumbai,” he said.
PNB informed the Department of Financial Services, under Jaitley, on 6 February.
Updated Date: Mar 14, 2018 11:17 AM