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PNB fraud case: Bank suspends 10 officials, jewellery designer Nirav Modi under CBI scanner

The Punjab National Bank (PNB) on Wednesday suspended 10 officials in connection with the billionaire jewellery designer Nirav Modi fraud case.

Edited by: India TV Business Desk, Mumbai [ Updated: February 14, 2018 23:49 IST ]
PNB suspends 10 officials in Rs 11,365-crore fraud case
PNB suspends 10 officials in Rs 11,365-crore fraud case involving jewellery designer Nirav Modi

The Punjab National Bank (PNB) on Wednesday suspended 10 officials in connection with the billionaire jewellery designer Nirav Modi fraud case.

The latest development comes in the backdrop of the bank detecting fraudulent and unauthorised transactions worth Rs 11,365 crore at one of its branches in Mumbai. 

Earlier in the day, the CBI received two complaints from PNB against Nirav Modi and a jewellery company in connection with the fraud case. 

Punjab National Bank, the second largest public sector bank in India, has detected a $1.8 billion fraud in one of its branches here, the bank said in a regulatory filing to the stock exchanges on Wednesday.

Also Read: CBI probing Nirav Modi after PNB detects 11,365-crore fraud in its Mumbai branch

"The bank has detected some fraudulent and unauthorised transactions (messages) in one of its branch in Mumbai for the benefit of a few select account holders with their apparent connivance," the filing by the bank said.

It had quoted the quantum of such transactions was to the tune of around $1,771.69 million (around Rs 11,515 crore).

The amount of fraudulent transactions is equivalent to eight times the bank's net income of about Rs 1,320 crore ($206 million).

This case has happened at a time when the Indian banking system is already grappling to tackle its swelling non-performing assets.

Also Read: PNB shares dip over 7% after fraudulent activities worth Rs 11,365 crore reported in Mumbai branch

"Based on these transactions other banks appear to have advanced money to these customers abroad. In the bank these transactions are contingent in nature and liability arising out of these on the bank shall be decided based on the law and genuineness of underlying transactions," the filing said.

The bank informed: "The matter is already referred to law enforcement agencies to examine and book the culprits as per law of the land."

On February 5, the Central Bureau of Investigation had booked billionaire diamond service provider Nirav Modi, his brother, wife and an enterprise companion for allegedly cheating Punjab National Bank of over Rs 280.70 crore last year.

Following the complaint, the CBI registered a FIR under the Indian Penal Code sections related to criminal conspiracy, cheating and provisions of the Prevention of Corruption Act against the four.

The stock of Punjab National Bank was trading at Rs 149.20 per share, down 7.70 per cent at the BSE at 1.59 p.m.

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