Published: Tue, May 15, 2018
Global | By Marsha Munoz

PNB seen posting huge Q4 loss due to $2 billion fraud, NPAs

PNB seen posting huge Q4 loss due to $2 billion fraud, NPAs

Trouble is mounting for India's top banker Usha Ananthasubramanian who is now the CEO and MD of Allahabad Bank. The CBI charge sheet named 25 accused, including three firms, the source added. "Reconciliation of SWIFT (Society for Worldwide Inter-Bank Financial Telecommunication) messaging system CBS was not done despite repeated caution notices of the RBI", a CBI official said.

Last month, the CBI had booked Syndicate Bank MD and CEO Melwyn Rego, who was deputy managing director of IDBI, along with several others in the Rs 600 crore IDBI loan default case. She is now serving as the CEO and MD of the Allahabad Bank.

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.

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PNB was hit by a almost Rs13,000 crore scam allegedly perpetuated by jewellers Nirav Modi and Mehul Choksi in connivance with some bank employees.

Mr Kumar also stated, after the CBI chargesheet, that the Allahabad Bank board has also been asked to divest Ananthasubramanian of all powers and initiate further action.

With DFS initiating the removal action, the PNB has made a decision to divest ED officers to replace them. Post the detection of the fraud, the banks including PNB were advised by RBI to maintain due diligence.

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The CBI has detailed the roles of Modi, Nishal Modi (his brother) and Subhash Parab, an executive in Nirav Modi's company. She was questioned recently by the CBI in connection with the case. The CBI has registered three separate FIRs in connection with the alleged fraud of Dollars 2 billion in the public sector bank by the companies of Nirav Modi and Choksi. The duo have denied the allegations against them, and authorities have said they both left the country before the fraud was uncovered.

PNB, India's second largest state-owned bank after SBI, in February unearthed that that it had been duped of Rs 12,000 crore through the fraud guarantees for Nirav Modi and Mehul Choksi.

Separately, India's banking secretary Rajiv Kumar told media in New Delhi that a government nominee on the board of state-run Allahabad Bank would soon call a meeting to seek the removal of Ananthasubramanian.

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