MUMBAI: The third case registered by the Central Bureau of Investigation in the Punjab National Bank scam cites, for the first time, fraudulent transactions having taken place prior to 2017 and raises the cumulative loss borne by the state-owned lender to over Rs 12,900 crore so far, up from Rs 12,638 crore estimated earlier. This third FIR was filed on March 4.
It is alleged that the accused — Nirav Modi’s Firestar Group, in connivance with others — caused a Rs 321.88-crore loss to PNB as fund-based and non-fund-based limits provided to the companies were not used for the purpose for which they were sanctioned, such as the import of rough diamonds and export of jewellery. Jewellers Modi, Mehul Choksi and their companies, along with PNB officials, are accused of being the perpetrators of the PNB fraud.
The first FIR, based on PNB’s complaint and registered on January 31, said that eight of the so called letters of undertaking (Lo-Us) or guarantees worth Rs 280.7 crore were fraudulently issued in 2017.
In the second FIR of February 15 also, the sham transactions are said to have taken place in 2017-18 through LoUs and foreign letters of credit (nonfund based), causing a loss of Rs 4,886.72 crore.
Prior to the third FIR, CBI had found Choksi’s Gitanjali Group caused a loss of Rs 6,138 crore and the Nirav Modi group Rs 6,500 crore.
The March 4 FIR lists fraudulent transactions in respect of fundbased limits, in addition to smaller non-fund-based limits, which cumulatively takes the fraud amount up to Rs 12,918.6 crore (excluding foreign letters of credit and standby letters of credit) from Rs 12,638 crore caused by guarantees or non-fund-based lending to Firestar Group and related companies and Gitanjali Group.
The most recent FIR accuses Modi, also named in the first FIR, his flagship Firestar International Ltd (FIL) and Firestar Diamonds International Pvt Ltd (FDIPL), Ravi Shankar Gupta, CFO of Firestar International, Vipul Ambani, president (finance) of Firestar International, and unknown public servants of PNB, among others, of cheating and fraud which caused a loss of Rs 321.88 crore to PNB. In the first FIR related to Modi, three partnership firms controlled by him were named but not flagship Fir ..
CBI said PNB, under consortium banking, sanctioned fund and non-fund-based credit limits to the Firestar Group. The fund-based and nonfund-based credit lines issued to Firestar International were not to exceed Rs 380 crore, of which Rs 259.37 crore were outstanding to PNB on March 4 since the amount was recalled on February 8. Similarly, of the sanctioned limit of Rs 72.5 crore for Firestar Diamond International, Rs 62.51 crore was owed to PNB.
CBI noted in its third FIR that circular transactions took place between Modi-promoted partnership firms Solar Exports, Stellar Diamond and Diamonds R Us — mentioned in the first FIR — and his other promoted flagship Firestar International and Firestar Diamond International. In the case of Firestar International, PNB was the lead bank, while Union Bank is the lead bank for Firestar Diamond International.
The fund-based and non fund-based facilities of Rs 321.88 crore were disbursed by PNB’s Brady House branch in Mumbai. In view of this, PNB’s head office has declared the accounts of Firestar International and Firestar Diamond International as “fraud” and the bank has reported the same to the Reserve Bank of India.