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PNB scam: 2 bank officials, Nirav Modi's company executive arrested by CBI

People detained including PNB's former deputy manager Gokulnath Shetty, bank's single window operator Manoj Kharat, and Hemant Bhat, who is authorised signatory of the Nirav Modi group firms

Shrimi Choudhary  |  Mumbai 

Nirav Modi scam at PNB
Enforcement Directorate team raids the Viviana Mall after a complaint filed by Punjab National Bank over Nirav Modi's fraud case, in Thane | Photo: PTI

The Central Bureau of Investigation (CBI) has arrested two former and current officials of Punjab National (PNB), and one executive of group of companies in the bank’s Rs 114 billion case.

This is the first in one of the biggest scams in the country’s banking history, allegedly premeditated by and Mehul Choksi, through a clutch of companies they own, in collusion with some PNB officials.

People detained include PNB’s former deputy manager Gokulnath Shetty, bank’s single window operator Manoj Kharat, and Hemant Bhat, who is authorised signatory of the group firms.

“All of them will be produced today before special court in Mumbai. Investigation in both the cases and examination of others are continuing, said a official.

The move follows two first information report (FIR) filed by the central agency against Nirav Modi, it’s relatives, Mehul Choksi, his firms and PNB officials. The was based on the complaints filed by the bank, first in January and second on February 13.

During the probe, alleged loss to PNB was over Rs 48 billion.

The on Friday had also conducted searches in 20 properties in six-cities linked to and its group companies. These include Maharashtra (Mumbai and Pune), Gujarat (Surat), Jaipur, Hyderabad, and

Explaining the modus operandi, a official said the said officials deliberately omitted entries, purportedly issued on behalf of accused companies, to avoid detection.

Funds raised through LoUs were meant to be issued for payment of import bills of the accused companies whereas it was dishonestly and fraudulently utilised for discharging the earlier liabilities on account of the buyer's credit facilities allowed by the overseas branches of an Indian bank, it was alleged.

While in case of foreign letters of credit (LC), they were opened initially for smaller amounts by creating purported entries in core banking solution system and sending the relevant LC through messages.

First Published: Sat, February 17 2018. 12:41 IST