Mumbai, February 14: The Punjab National Bank (PNB) suspended 10 of its officials after over Rs 10,000 crore fraud was unearthed at one of its branches in Mumbai on Wednesday. The fraud is said to be linked with famous jewellery designer Nirav Modi.
The Central Bureau of Investigation (CBI), which has started probing the case, has received two complaints from the Punjab National Bank (PNB) against celebrity jeweller Nirav Modi and a jewellery company, linked to a fraud worth over Rs 10,000 crore, news agency PTI reported.
“All the officials of PNB suspended today are of the same branch. This is the part of non-performing asset (NPA) reforms agenda. Cleaning of banks is the top priority of the government. The government had directed all the banks that the NPA clean-up would help honest borrowers get loans. After having capitalised, we will ensure that all banks are cleaned up,” said Rajiv Kumar, department of financial services secretary.
Kumar also said this was a one-time cleaning exercise. “Whatever it takes, whatever is required, we will do that,” he told the media.
The CBI on Monday had booked Nirav Modi, his brother Nishal Modi and the officials of PNB in this regard. Nirav Modi, 48, is accused of fraud worth Rs 280 crore.
Lok Ranjan, Joint Secretary of Department of Financial Services, said that the government had taken note of it and certain steps were being taken but refused to divulge details. “It is not in my domain and it is not right for me to comment on it further,” he said.
The CBI received the bank’s complaint on Tuesday night after which the allegations ae being looked into and the course of action will be decided soon.
It is still not clear whether the complaint is linked to the bank’s revelation this morning that it had decided a $1.8 billion (over Rs 10,000 crore) fraud at a single branch in Mumbai.
PNB, India’s second-biggest state-run bank, said in a regulatory filing to the stock exchange that it had detected “fraudulent and unauthorised transactions in one of its branches in Mumbai for the benefit of a few select account holders with their apparent connivance”. Based on these transactions, said PNB, “other banks appear to have advanced money to these customers abroad”.
The Mumbai-based jeweller’s three offices in Delhi, Surat and Jaipur was also raided by income tax officials on January 31.
Nirav Modi is the founder of $2.3 billion Firestar Diamond and counts among his clients several world renowned celebrities. He has boutiques across three continents – in London, New York, Las Vegas, Hawai, Singapore, Beijing and Macau. In India, Nirav Modi has his stores in Mumbai and Delhi.
In 2016, Nirav Modi was named among Forbes’ list of India’s Richest 100 businessmen, with a net worth of $ 1.74 billion.