New Delhi Feb 17 : Did the fraud at Punjab National Bank (PNB) continue even after the "main culprit", named by the bank, retired?
It would seem so from the details provided by PNB to the investigative agency on the basis of which the Central Bureau of Investigation (CBI) filed two first information reports -- one against three companies of Nirav Modi and the other against the Gitanjali group of three companies of Mehul Choksi, uncle of Nirav.
According to the second complaint made by PNB, Gokulnath Shetty, then deputy manager posted at the Brady House branch in Mumbai, along with Single Window Operator Manoj Hemant Karat, fraudulently issued Letters of Undertaking (LoUs) and Foreign Letters of Credit (FLC) in favour of the Gitanjali group of companies which amounted to a fraud of Rs 4,886.72 crore.
LoUs by banks are issued for 90 days according to RBI norms.
But Shetty and Karat conspired to issued LoUs to foreign branches of Indian banks for about 360 days, PNB said.
No information on these transactions was given in the core banking solution (CBS) system of the bank, which tracks all transactions.
Shetty retired from PNB on May 31, 2017.
In all, 143 LoUs were issued starting on March 1, 2017, and the last set six LoUs are to come up for payment on April 23, 2018 -- in less than a year.
Similarly, for FLCs, the two officers entered a smaller amount in the CBS to generate a reference number.
Subsequently, they increased the amounts by a message through the SWIFT transaction network to the beneficiary bank without any reference to the CBS of PNB.
The beneficiary or overseas supplier discounted these documents based on the enhanced amounts.
Again, all FLCs issued in 2017 (no dates are given) have due dates in 2018 for payment.
These too should have been less than a year after Shetty retired.
But intriguingly, there are six transactions out of kilt from a total of 224 -- two with due dates in June 2018 and four with due dates in July 2018.
So was someone else approving these transactions after Shetty retired? PNB has not given any explanation to the investigating authories on this discrepancy.
The transactions (3731FLC 20113/17 and 114) are amounts of (Dollar) 1,099,982 and (Dollar) 999,858 in favour of Gitajali Gems, both with due dates of June 24, 2018.
The four with due dates of July 7, 2018, are also all to Gitanjali Gems (FLC No 55/17) with amounts of (Dollar) 1,073,434, (Dollar) 1,122,083, (Dollar) 1,127,578 and (Dollar) 1,089,525.
The total amount of these six apparently "post-retirement" transactions are (Dollar) 6,512,460 or Rs 41.68 crore.
Who approved these transactions? Were there more than two people involved in approving the money through LoUs and FLCs?