PNB fraud case: CBI files chargesheet against Mehul Choksi, others

The board asked the finance ministry to make suitable arrangements for smooth functioning of the bank

On Monday, the CBI had filed its first charge-sheet against Nirav Modi for defrauding PNB to the tune of ₹6,498.28 crore.

CBI filed the chargesheet just before the 90-day period to file charges.

The agency also named PNB Executive Directors K.V. Brahmaji Rao and Sanjiv Sharan, and General Managers Nehal Ahad (who dealt in worldwide operations) and Rajesh Jindal in its chargesheet filed in a special CBI court here.

After filing chargesheet in the Nirav Modi bank fraud case, the CBI on Wednesday filed its second chargesheet against billionaire jeweller Mehul Choksi and 17 other entities, including companies owned by him and other individuals, in connection with the over $2 billion Punjab National Bank (PNB) scam. They include PNB's single window operator Manoj Kharat, former PNB Managing Director Usha Ananthasubramanian, who now heads Allahabad Bank, PNB Executive Director KV Brahmjai Rao, bank's Executive Director Sanjeev Sharan and General Manager (International Operations) Nehal Ahad. "We have arrested Gokulnath Shetty, Manoj Kharat, Aniyath Nair, who is one of the directors of Gilli India and Vipul Chitalia, vice president (Banking Operations) of Gitanjali Group".


On the fraud front, the bank said the matter is under investigation. This case is registered on the basis of a CBI FIR. While 7000 crore is the amount of the scam committed by Choksi of which CBI has found evidence 6 FLC's and 6 LOU's amounting to 512 crores. With regards to provision made for the loss incurred on account of Nirav Modi fraud, the bank said it provided for Rs 7,178 crore, 50 per cent of the total amount of Rs 14,356 crore in the fourth quarter of 2017-18.

The fraud was detected at PNB's Brady House branch in Mumbai involving certain accounts under "gems and jewellery" sector wherein, through apparent connivance between "these entities and few employees of the bank", some LoUs/FLCs were issued fraudulently to certain overseas branches of Indian banks through misuse of the SWIFT messaging system.

Tighter RBI rules announced in February, which did away with half a dozen loan restructuring schemes, have led to banks reporting a surge in bad loans in the March quarter, and several of them reporting losses. They all are charged under sections 409, 420, 120B of the Indian Penal Code (IPC).

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