PNB scam: ED raids Akshat showroom in Raipur

PNB fraud Gitanjali Gems tanks 40% since February 14 Rs 300 crore in market capitalisation wiped out

Modi, a regular feature on the lists of rich and famous Indians since 2013, was booked by the CBI, along with wife, brother and Choksi on January 31, for allegedly cheating the state-run bank to the tune of Rs 280 crore.

This statement is likely to trigger uncertainty among other banks that had provided loans on the strength of these LoUs, which are in the nature of bank guarantees.

The probe by the Enforcement Directorate has revealed that an additional Rs 3,000 crore was lent by 17 banks to many companies belonging to Nirav Modi. The complaint was filed by PNB DGM Avneesh Napalia to Joint Director, CBI on January 29, 2018. "All left with their families", the officer added. "Nirav Modi has been a partner of the BJP and was at the forefront in helping the BJP collect funds for their elections".

"We at Gitanjali Gems are not aware of any such raids or visits by the ED as of now", said a spokesperson for the company. "All allegations being directed at us seem premature considering that the matter is still under investigation".

PNB said a series of transactions at a single branch in Dubai were made "for the benefit of a select few account holders with their apparent connivance". Past due payments of buyers' credit were paid off using another buyers' credit issued by Allahabad Bank and Axis Bank branches in Hong Kong. "He should talk about how this loot happened and what he intends to do to protect the banking system".

Another CBI officer familiar with the matter said PNB had issued around 150 LoUs involving Rs6,400 crore to companies promoted by Modi and more letters, for around Rs4,000 crore to Choksi's companies.

The Congress, however, alleged that the government did nothing to stop "independent India's biggest bank fraud" despite being informed of it in July, 2016.

The Congress has also shared a picture of Prime Minister Modi with Nirav Modi which is said to be clicked a day before the CBI registered its FIR.

State-run banks have demanded that PNB honour its LoUs, based on which they lent to companies related to Modi.

PNB said on Friday it was running an audit of its systems to prevent a recurrence of such a fraud, but did not see a long-term hit to its operations.

According to Mehta, Modi has approached the lender with a vague repayment plan, and the bank has asked him to come up with a concrete repayment plan.

Seeking police remand for the maximum period of the accused, a Central Bureau of Investigation's counsel said investigators need to recover certain important documents and records pertaining to the case, unravel the modus operandi of the fraudsters and zero in on the exact magnitude of the crime.

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