Nirav Modi.

Nirav Modi.

21 more PNB fraud-related raids, property worth Rs 5,674 seized: ED

Three PNB fraud accused sent to 14-day police custody

Agency Report | New Delhi | 17 February, 2018 | 11:50 PM

The Enforcement Directorate (ED) on Saturday conducted raids at 21 places across India and seized assets worth Rs 25 crore in connection with the multi-crore Punjab National Bank (PNB) scam, an official said.

“The ED conducted further searches at 21 locations across India in the Nirav Modi case and seized diamonds, gold, precious stones, and jewellery worth Rs 25 crore (book value). The total seizure till now in the case is Rs 5,674 crore,” ED spokesman, Anil Rawal said.

The agency on Friday had conducted searches at 35 locations in connection with the fraud involving around Rs 11,300 crore and seized diamonds, gold, and jewellery worth Rs 549 crore.

The ED on Thursday registered an FIR under the Prevention of Money Laundering Act and conducted raids after the alleged fraud by billionaire diamond trader Nirav Modi and his Mumbai-based firms Diamond R US, Solar Exports, and Stellar Diamonds.

Six properties in Mumbai belonging to the jeweller were also sealed.

The action is based on a Central Bureau of Investigation (CBI) case registered against Nirav Modi on Wednesday in connection with the fraud sum of Rs 6,498 crore.

The CBI on Thursday registered fresh FIRs against 10 directors of the Gitanjali Group of companies on charges of criminal conspiracy and cheating under the Indian Penal Code and Prevention of Corruption Act, including Mehul Choksi, Managing Director of Gitanjali Gems Ltd based in Mumbai’s Walkeshwar.

The FIR also named two former bank employees said to be directly involved in the fraudulent transactions.

Additionally, three companies of Gitanjali Group were also named in the CBI FIR for causing alleged loss of Rs 4,886.72 crore.
A Special CBI court on Saturday remanded the three accused arrested in the over Rs 11,300 crore Punjab National Bank (PNB) fraud case to police custody till March 3.

These include retired PNB Deputy Manager Gokulnath Shetty, Single Window Operator Manoj Kharat and an authorised signatory of prime accused Nirav Modi’s group companies.

These three were arrested by the Central Bureau of Investigation (CBI), which has also named 10 other directors and officials as accused in the scam.

They are: Krishnan Sangameshwaran, Nazura Yashjaney, Gopal Das Bhatia, Aniyath Shivraman, Dhanesh Vrajlal Sheth, Jyoti Bharat Vora, Anil Umesh Haldipur, Chandrakant Kanu Karkare, Pankhuri Abhijeet Varange, and Mihir Bhaskar Joshi.

Diamond trader Nirav Modi and other accused, including trade partner and relative Mehul Choksi, left the country in early January, before the massive PNB fraud came to light.
Punjab National Bank (PNB) officials had met representatives of Nirav Modi and Gitanjali groups to impress upon them to pay outstanding amounts, the bank said in a clarification to the stock exchanges.

“A series of meetings were held with representatives of Nirav Modi group and Gitanjali group at Delhi & Mumbai to impress upon them to pay the amount. They were also directed to provide all necessary documents as per law to ensure that the imports are bonafide trade transactions,” the PNB statement said in the clarification dated February 15 to the exchanges accessed on Saturday.

Giving details of the fraud on the bank, the statement said that “on January 16, 2018, the partnership firm of Nirav Modi group approached our branch at Brady House, Mumbai and presented a set of import documents with a request to allow buyers’ credit for making payment to the overseas suppliers.”

“Since there was no sanctioned limit in the name of the above firms, the branch officials requested the firms to furnish at least 100 per cent cash margin for issuing Letter of Undertaking (LOU) for raising buyer’s credit. The firms contested that they have been availing such transactions since past several years,” it said. On scrutiny the bank found that fraudulent LoUs had been issued favouring the two groups.

On February 14, PNB informed the stock exchanges that a $1.8 billion fraud had happened in one of its Mumbai branches.

The Central Bureau of Investigation (CBI) and the Enforcement directorate started investigating. The CBI has since arrested PNB’s retired Deputy Manager, Gokulnath Shetty and its Single Window Operator Manoj Hemant Karat. One authorised signatory of the Nirav Modi group was also arrested. The three were remanded to police custody till March 3 by a CBI court on Saturday.

The clarification by PNB also states: “Foreign bank branches namely Allahabad Bank, Hong Kong, Axis Bank, Hong Kong and other banks were requested to provide all communication with borrower and documents if any held in their record to understand bonafide of the transactions.”

The main accused in the case Nirav Modi, his wife Ami, brother Nishal Modi and maternal uncle Mehul Choksi left the country in January. The CBI is sending notices to ask them to be present themselves for further investigation.

Meanwhile, the PNB said it would be holding an extraordinary general meeting on March 16, 2018. (IANS)