APYC protest on PNB fraud issue

With an outstanding of over Rs 600 crore to Gitanjali, ICICI Bank is the lead bank in the consortium of 31 banks which have loaned over Rs 6,800 crore to the company. The National Company Law Tribunal has also allowed the government to attach 64 properties belonging to individuals as well as companies that are part of groups headed by Modi and Choksi to prevent the accused from alienating as well as creating any third-party interest in any of the properties.

Prior, a senior authority of the ICICI Bank was summoned to the CBI office in Mumbai.

ICICI Bank chief executive Chanda Kochhar and Axis Bank chief executive Shikha Sharma were summoned by the SFIO to help the agency understand the amount of exposure and whether due diligence was followed while lending.

Axis Bank, the third largest private sector lender, does not have any direct exposure to Gitanjali, while it was among the several banks whose overseas branches had loaned money to PNB based on the fraudulent LoUs.

The Central Bureau of Investigation (CBI) on Tuesday detained Vipul Chitalia, vice president - banking operations of Gitanjali Group of Companies at the Mumbai airport for questioning. The court, set up under the Prevention of Money Laundering Act (PMLA), issued the NBWs on applications filed by the Enforcement Directorate (ED), one of the agencies probing the bank fraud cases registered last month. The reports said Kochhar was questioned on Sunday and Monday as well.

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Axis Bank said its exposure to these entities is just Rs 200 crore and that the bank is not a leader in the consortium. The other details about Chitalia's alleged role in the PNB fraud were not revealed.

The fraud was allegedly perpetrated by billionaire jeweller Nirav Modi and his uncle Mehul Choksi, the promoter of Gitanjali Gems.

They were sent through an worldwide messaging system for banking called SWIFT, which is used to pass instructions among banks globally to transfer funds.

In a move that could bring more skeletons from cupboards of state-run banks, the finance ministry had asked them to closely scrutinise all non performing assets (NPAs) above Rs 50 crore to detect any signs of frauds.

  • Sonia Alvarado