PNB officials ‘took cut’ to issue LoUs

New Delhi, February 18

Punjab National Bank officials used to take percentage commissions in lieu of issuing Letters of Undertaking (LoUs) and foreign letters of credit to diamond czar Nirav Modi, partner Mehul Choksi and their firms, according to the probe into the Rs 11,300-crore banking scam.

The fresh revelation has come after the CBI questioned former PNB Deputy Manager Gokulnath Shetty, single window operator Manoj Kharat, and Hemant Bhatt, the authorised signatory of prime accused Nirav Modi’s group of companies.

According to CBI sources, the arrested bank officials disclosed that for every LoU, a percentage of the amount was fixed depending upon the amount to be sanctioned.

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The commission collected was then distributed among employees of PNB involved in the scam. The involvement of more staff members was being probed. — PTI

Overseas bank staff under scanner too

Officials at overseas branches of other banks are under scanner, say sources. The encashment of LoUs for gems and jewellery sector is usually of 90 days and not 365 days — the maturity period of majority of LoUs linked with fraud. The deviation from usual practice should have caught the attention of officials working at the Hong Kong branch of other lenders, say sources.

200 shell firms being probed

At least 200 shell firms and “benami” assets have come under the scanner of the investigating agencies. The Enforcement Directorate and Income Tax Department had zeroed in on 200 dummy or shell companies in the country and abroad that were being used to route or receive funds as part of the alleged fraud, say officials. PTI