After three months of investigation, the CBI on Monday filed the first chargesheet in the Rs 13,000 crore PNB scam, naming the bank’s former chief Usha Ananthasubramanian and 24 other top bank officials, and declaring billionaire diamond tycoon Nirav Modi as “a wanted’ accused.
Nirav left India in January this year.
Usha, who is currently serving as CEO and MD of Allahabad Bank, had held the same post in PNB from August 2015 to 2017. She is accused of not complying with a 2016 circular of the Reserve Bank of India on the Swift (Society for Worldwide Inter-bank Financial Telecommunications) system.
The CBI will file second chargesheet in the case, involving Mehul Choksi of Gitanjali Gems ltd, by the end of this week.
Along with Usha, three other top officials, PNB executive directors KV Brahmaji Rao, Sanjiv Sharan, and general manager (International Operations) Nehal Ahad, have been named for lapses in handling of the Swift system under Section 409 of the Indian Penal Code (IPC) for criminal breach of trust and Section 420 of the IPC for cheating.
The country’s second-largest State-run bank disclosed in February that two jewellery groups had defrauded it by raising credit from overseas branches of other Indian banks using illegal guarantees issued by rogue PNB staff over several years.
The three firms mentioned in the chargesheet are: Diamonds RUs, Stellar Daimonds and Solar Exports. The chargesheet, however, did not name Nirav’s wife Ami and his uncle and business partner Mehul Choksi.
The chargesheet says Nirav, his brother Nishal Modi, and Subhash Parab, an executive in Nirav’s firms, conspired for issuance of fraudulent letters of Undertaking (loUs).
The chargesheet primarily deals with the first FIR registered in the case relating to the fraudulent issuance over Rs 6,498.20 crore worth of loUs to Diamond R US, Solar Exports and Stellar Diamonds.
Giving details of the charges against Usha, the CBI sources said she was the MD and CEO of PNB when a similar case of loU fraud was reported from Indian Overseas Bank, Chandigarh in 2016 where credits were issued by PNB’s Dubai branch on the basis of these guarantees.
The modus operandi in the IOB case was similar to the Nirav case. Hence, the top brass of PNB had complete knowledge of the methods involved by fraudsters to cheat the banks using loUs, sources said.
After the IOB fraud had surfaced, the RBI had issued guidelines and circulars to prevent such frauds in the banks which were allegedly not implemented in PNB in its entirety, they said.
The agency has not given in detail the role of Choksi in the present charge sheet. It is expected to come up when the CBI files supplementary charge sheets in the case related to the probe into his Gitanjali Group.
Both Nirav and Choksi had left the country before PNB filed the complaint with the CBI. Some PNB officials already arrested by the CBI have also been named for misusing official position, criminal conspiracy, forgery and cheating. These arrested accused include Gokulnath Shetty, former deputy general manager of PNB; Manoj Kharat, single window operator of PNB; Hemant Bhat, authorised signatory of Modi’s company; Bechhu Tiwari, then chief manager in the forex department of PNB; Yashwant Joshi, scale-II manager in forex department; and Praful Sawant, scale-I officer handling exports section.
Other accused named in the chargesheet included Manish K Bosamiya, then AGM (operations) of Nirav’s Firestar International, and then finance manager Miten Anil Pandya. They allegedly prepared the applications for fraudulent loUs submitted to the PNB. Vipul Ambani, president, finance, Firestar International, Kavita Mankikar, executive assistant and authorised signatory of three firms of Nirav Modi, and Arjun Patil, senior executive, Firestar Group, have also been named.
So far, the CBI has arrested 20 people in the PNB scam.
The CBI has registered three separate FIRs in connection with the alleged fraud of USD 2 billion in the public sector bank by the companies of Nirav and Choksi.