The Punjab National Bank scam has forced the Central Bureau of Investigation to finally act. After sitting on a complaint from Oriental Bank of Commerce for nearly six months, the CBI has filed a case against a Delhi-based jewellery outlet Dwarka Das Seth International Private limited for alleged fraud of Rs 390 crore.
The case has been registered against Karol Bagh-based Dwarka Das Seth International, engaged in manufacturing/trading of diamond, gold and silver jewellery, and other ornaments. It was alleged that the company had availed credit facilities from the bank’s Greater Kailash-II branch since 2007 by getting Foreign letters of Credit.
OBC had approached the CBI on August 16, 2017. The bank said that the company enjoyed credit facilities including foreign bill discounting.
They began availing this facility in 2007, the complaint stated. The company is run by Sabhya Seth and Reeta Seth — both residents of Punjabi Bagh — and Krishan Kumar Singh and Ravi Kumar Singh (all directors of the firm), residents of Sarai Kale Khan and another company named Dwarka Das Seth SEZ Incorporation. The FIR names all of them. The fraud comes to light after the multi-crore Nirav Modi-Punjab National Bank scam that was reported earlier this month.
The bank, after its own inquiry, claimed that Sabhya Seth and other directors along with their family members could not be traced at their residences for the last 10 months. It is suspected that Sabhya Seth may have fled India.
The bank claimed in its complaint that Dwarka Das Seth International enjoyed various credit facilities including foreign bill discounting under letters of credit (lCs). They first started availing this facility in 2007 and bills were regularly realised before further bills were discounted.
Sabhya, OBC says, was utilising this facility under lCs established by foreign banks abroad. Some of these banks were poorly rated. The banks include Dubai Bank Kenya, Soleil chartered Bank, Trade Chartered Bank, TF Bank Kontrakt Inc and Century Bank Corp llC.
The process continued till the bank noticed the poor rating of these banks. Therefore, the bank decided not to discount any further bills under letter of credit of the abovementioned banks.
After that the bank had advised its representative office in Dubai to contact the buyers. Some of the buyers such as Devi Jewells llC, Mannat FZE, FiatDiam International did not respond to the queries of the bank. During the investigation, it was revealed that Mannat FZE, Green Apple Trading FZE, Freya Trading FZE were found non-existent.
In its complaint, OBC stated that Sabhya Seth of Dwarka Das Seth International Private limited, had orchestrated an elaborate plan for duping the bank. The Trade Chartered Bank is an equal partner in crime.
They had established letter credit without the request of the opener as is alleged by one of the buyers M/s Al Salam Jewelry of Dubai.