21:55 Thanks to all our readers for following us throughout the day on updates about what is easily the biggest banking sector scam in recent times. Please stay tuned for more updates about the scam.
20:45 As a multi-agency probe continues against Nirav Modi for allegedly masterminding India's biggest-ever banking fraud, the stock market dealings of his relative and close associate Mehul Choksi has come under the scanner of markets regulator Sebi and stock exchanges.
The Securities and Exchange Board of India (Sebi) and the stock exchanges have begun analysing the stock market trade details of all entities associated with Modi including Choksi, who has already been under scanner for various cases including a brokerage default incident, a senior official said.
19: 30 Scam-hit PNB today said Nirav Modi, who allegedly defrauded the bank of about Rs 11,400 crore, has come up with "some vague offers" to repay the amount, even as the Enforcement Directorate continued raids at properties connected with the jewellery designer.
18:39 The Aam Aadmi Party today mounted an attack on the Centre over an alleged multi-million dollar scam involving diamantaire Nirav Modi, alleging that he could flee the country because he had access to the Prime Minister's Office.
Delhi Chief Minister Arvind Kejriwal asked if he had left the country with the backing of the government. In another tweet, senior AAP leader Ashutosh said 42 FIRs against Modi had been sent to the PMO since July 26, 2016. Yet, he was seen with Prime Minister Modi in Davos at the World Economic Forum last month.
18:31 The finance ministry today said the assets in the Nirav Modi fraud case involving state-owned Punjab National Bank (PNB) will be recovered and nobody will be spared.
Talking to reporters on the PNB fraud case, Financial Services Secretary Rajiv Kumar said the bank will make the required provisioning and it has "sufficient" funds for it. "Whole lot of assets will be recovered. Nobody will be spared," Kumar said.
17:56 The source from the ED has said that there will be an investigation to determine if there was any round-tripping of funds or if some loopholes might have been exploited by those involved.
17:46 The source from the ED has told Moneycontrol's Tarun Sharma that it would be investigating the senior management of the bank as well in this case because it believed it was impossible for just normal bank officials to pull of a fraud of this magnitude. The source said that it was possible that the bank is making a scapegoat of a retired former employee.
17:43 The source from the ED has also said that some of the locations searched by it were sealed. Among the raided locations 5 were in Mumbai, 3 in Surat and 2 in Delhi. Apart from this, the source said that the ED will also be ascertaining whether the quantum of the fraud was around Rs 11,000 crore, as has come to light, or if it is more than that.
17:41 Moneycontrol's Tarun Sharma reports, quoting a source from the Enforcement Directorate, that searches have been conducted at 10 different locations, those that were not raided by CBI earlier. The source also mentioned that the ED had seized gold and jewellery at these locations and that the valuation process is due to begin shortly.
17:19 This entire NPA mess is an inherited monster, no NPA loans have been given while this government has been in power, says law and IT minister Ravi Shankar Prasad.
17:16 We have plenty of photographs of Congress leaders with Mehul Choksey but we don't want to stoop to that level, says BJP leader Ravi Shankar Prasad.
16:47 Modus operandi of the $1.8 billion PNB-Nirav Modi scam
Three diamond firms belonging to the Nirav Modi Group and some other firms owned by Gitanjali Gems held current accounts at a domestic branch of Punjab National Bank (PNB).
These firms purchased raw gems from overseas firms, and had to make payments to the sellers in foreign currency.
The sellers of the raw gems held accounts at foreign branches of Indian banks.
A junior official at PNB fraudulently issued ‘letters of undertaking’ (LoUs), allowing Niravi Modi group companies to get short term loans (buyers’ credit) from overseas bank branches to pay the sellers. Under the terms of the LoU, PNB was the guarantor of these loans.
16:33 According to CNBC-TV18, many bankers have requested the RBI to instruct PNB to pay up the outstanding on the LoUs.Many banks met the central bank complaining about dues from PNB.
15:15 CBI had issued a lookout circular against four individuals including Nirav Modi and Mehul Chokshi on February 2. Lookout notices are issued to prevent alleged wrong-doers from fleeing the country.
14:59 We were not in govt in 2011, if Congress is making allegations, were they sleeping from 2011-14? They should've probed it. This govt is taking cognizance of matters & probing them. Congress' was a govt of scams & they established these scamsters: MoS Finance SP Shukla
14:42 Nirav Modi left the country on 1st of January. CBI received complaint from PNB on 29th Jan 2018. CBI registered the case on 31st January, sources told ANI.
14:08 PNB MD & CEO Sunil Mehta will hold a conference call at 5:30 pm.
14:00 Nirav Modi suspected of laundering demonetised notes, sources told CNN-News18.
13:46 Nirav Modi crashes party for PSU banks! stay with NBFCs and private banks
PSU Banks which lost nearly Rs 20,000 crore in market capitalization on Wednesday after Punjab National Bank (PNB) declared a fraud of over Rs1000 crore, 8 times its FY17 profit, spooked investors on D-Street.
Public Sector Banks (PSBs) which were making a comeback thanks to Reserve Bank of India’s (RBI) recapitalization plan and new non-performing asset (NPA) rules may have now lost the race to private banks as well as NBFCs which are now looking attractive from the investment perspective.
‘Stay away from PSU banks’, which is the word coming from experts on D-Street. The concern of most analysts is that nobody knows if it is the beginning or the end.
12:59 Priyanka Chopra, the brand ambassador for Nirav Modi, is suing Nirav Modi for not paying her for a diamond advertisement, reports Times Now.
12:51 Writing to PNB, Nirav Modi is seeking 6 months time, according to India Today. In total, 30 banks have been affected. Sources have told the TV channel that he will sell the brand to sell the loan.
12:34 JUST IN| Nirav Modi is in Switzerland, according to sources quoted by CNN-News18
12:26 ED has filed Rs 11,300 crore case against Nirav Modi. Earlier it was reported that a Rs 280 crore case was filed. According to CNN-News18, Nirav Modi has written to banks saying that he will repay the loans. Reports say that he is ready to pay Rs 5,000 crore.
12:14 JUST IN| ED raids Nirav Modi showroom in Delhi's defence colony
12:06 According to reports, Union Bank, SBI Overseas Bank, Axis Bank and Allahabad Banks, are among those who lent money to Nirav Modi. Union Bank lent Rs 2,300 crore, Allahabad Bank lent Rs 2,000 crore and SBI Overseas lent Rs 960 crore.
11:54 Since the time the PNB fraud was identified, major jewellers have come under the scanner. PC Jeweller CFO however clarified stance and said the firm is not related to the case in any way.
11:15 ED raids offices of Nirav Modi, PNB, Gitanjali gems
The Enforcement Directorate is currently conducting raids at the residence and offices of Nirav Modi and PNB, reports Moneycontrol's Tarun Sharma. The ED had earlier registered money laundering case against Nirav Modi and others in connection with the scam. Proceedings have begun against officials named in the FIR. As of now, raids are being conducted in 12 properties of Nirav Modi. According to CNN-News18, Nirav Modi left the country even before the PNB FIR was filed.
10:55 Sebi likely to probe disclosure lapses by banks, jewellery firms
Sebi is likely to probe possible disclosure lapses by banks and other listed companies, including several jewellery firms, that have come under the scanner in connection with the whopping Rs 11,000 crore fraud detected at state-owned PNB.
Besides, the watchdog and the stock exchanges would analyse trading data of these companies and their top officials, some of whom are already under the scanner for insider trade and other violations, officials said.
The latest development, experts believe, is expected to give further push for the regulator's proposal to mandate listed companies to disclose loan defaults within a day of happening. The proposal has been put off apparently due to reservations expressed by the banking industry.
10:44 ED registers money laundering case against Nirav Modi and others in connection with Punjab National Bank cheating case.
10:32 Axis Bank clarifies, says bank had sold down all the referred transactions w.r.t PNB's LoUs.
10:30 How Punjab National Bank's Rs 11,000 cr scam was operated
Punjab National Bank (PNB) is witnessing probably one of the biggest scams in banking history, opening a can of worms worth over Rs 11,300 crore (USD 1,771.69 million) for the banking sector.
Fraudulent transactions likely to have been going on for last seven years were unearthed by PNB -- the second largest public sector bank and fourth-largest lender by assets – at one of its Mumbai branches.
Foreign branches of at least two Indian banks including Axis Bank and Allahabad Bank are likely to have been caught in the fraud with an alleged credit offering given based on letters of undertaking (LOUs) issued by PNB allegedly towards group companies of Nirav Modi and Gitanjali Gems.
10:17 Hello and good morning! This blog will keep track of the latest developments in the recent PNB scam, amounting to more than Rs 11,000 crore. The scam orginated from a Mumbai branch where the bank spotted that fake LoUs were allegedly being issued to Nirav Modi, among other diamond firms.
Thanks to all our readers for following us throughout the day on updates about what is easily the biggest banking sector scam in recent times. Please stay tuned for more updates about the scam.
As a multi-agency probe continues against Nirav Modi for allegedly masterminding India's biggest-ever banking fraud, the stock market dealings of his relative and close associate Mehul Choksi has come under the scanner of markets regulator Sebi and stock exchanges.
The Securities and Exchange Board of India (Sebi) and the stock exchanges have begun analysing the stock market trade details of all entities associated with Modi including Choksi, who has already been under scanner for various cases including a brokerage default incident, a senior official said.
The Left and the Trinamool Congress today attacked the government on the PNB fraud case and asked it to clarify how was accused Nirav Modi present in a group photo of Indian CEOs with the Prime Minister in Davos.
CPI(M) general secretary Sitaram Yechury questioned how billionaire jeweller Nirav Modi was allowed to escape the country.
Scam-hitPNBtoday saidNiravModi, who allegedly defrauded the bank of about Rs 11,400 crore, has come up with "some vague offers" to repay the amount, even as the Enforcement Directorate continued raids at properties connected with thejewellerydesigner.
The Aam Aadmi Party today mounted an attack on the Centre over an alleged multi-million dollar scam involving diamantaire Nirav Modi, alleging that he could flee the country because he had access to the Prime Minister's Office.
Delhi Chief Minister Arvind Kejriwal asked if he had left the country with the backing of the government. In another tweet, senior AAP leader Ashutosh said 42 FIRs against Modi had been sent to the PMO since July 26, 2016. Yet, he was seen with Prime Minister Modi in Davos at the World Economic Forum last month.
The finance ministry today said the assets in the Nirav Modi fraud case involving state-owned Punjab National Bank (PNB) will be recovered and nobody will be spared.
Talking to reporters on the PNB fraud case, Financial Services SecretaryRajivKumar said the bank will make the required provisioning and it has "sufficient" funds for it. "Whole lot of assets will be recovered. Nobody will be spared," Kumar said.
The source from the ED has said that there will be an investigation to determine if there was any round-tripping of funds or if some loopholes might have been exploited by those involved.
The source from the ED has told Moneycontrol's Tarun Sharma that it would be investigating the senior management of the bank as well in this case because it believed it was impossible for just normal bank officials to pull of a fraud of this magnitude. The source said that it was possible that the bank is making a scapegoat of a retired former employee.
The source from the ED has also said that some of the locations searched by it were sealed. Among the raided locations 5 were in Mumbai, 3 in Surat and 2 in Delhi. Apart from this, the source said that the ED will also be ascertaining whether the quantum of the fraud was around Rs 11,000 crore, as has come to light, or if it is more than that.
Moneycontrol's Tarun Sharma reports, quoting a source from the Enforcement Directorate, that searches have been conducted at 10 different locations, those that were not raided by CBI earlier. The source also mentioned that the ED had seized gold and jewellery at these locations and that the valuation process is due to begin shortly.
This entire NPA mess is an inherited monster, no NPA loans have been given while this government has been in power, says law and IT minister Ravi Shankar Prasad.
We have plenty of photographs of Congress leaders with Mehul Chokseybut we don't want to stoop to that level, says BJP leader Ravi Shankar Prasad.
During searches, CBI sealed residence of Ami Modi, wife of Nirav Modi in Mumbai's Worli. CBI conducted raid at her residence on 3 & 4 February, reports ANI.
Modus operandi of the $1.8 billion PNB-Nirav Modi scam
Three diamond firms belonging to the Nirav Modi Group and some other firms owned by Gitanjali Gems held current accounts at a domestic branch ofPunjab National Bank(PNB).
These firms purchased raw gems from overseas firms, and had to make payments to the sellers in foreign currency.
The sellers of the raw gems held accounts at foreign branches of Indian banks.
A junior official at PNB fraudulently issued ‘letters of undertaking’ (LoUs), allowing Niravi Modi group companies to get short term loans (buyers’ credit) from overseas bank branches to pay the sellers. Under the terms of the LoU, PNB was the guarantor of these loans.
According to CNBC-TV18, many bankers have requested the RBI to instructPNBto pay up theoutstanding on theLoUs.Many banks met the central bank complaining about dues from PNB.
Here's something to know about Nirav Modi
No official business delegation travelled with PM Modi. There was no meeting between Nirav Modi and PM Narendra Modi in Davos, it was just a photo opportunity at an event, reports ANI.
The raids started at 11 am in Nirav Modi's Delhi branch in Defence Colony. Till now, there has been no update.
The complaint letter to PMO regarding the Nirav Modicase was acknowledged in 2016 itself.
All this loot happened during UPA regime. We have brought this out and action will be taken, Defence Minister Nirmala Sitharaman says slamming the Opposition's claims.
CBI hadissued a lookout circular against four individuals including Nirav Modi and Mehul Chokshi on February 2. The lookout notices are issued to restrict alleged wrong-doers from leaving the country.
Nirav Modi's wife, an American citizen, left India on 6 Jan 2018, Mehul Choksi left the country on 4 Jan 2018., Nirav Modi's brother Nishal Modi, a Belgian citizen, left India on 1 Jan 2018, reports ANI.
We were not in govt in 2011, if Congress is making allegations, were they sleeping from 2011-14? They should've probed it. This govt is taking cognizance of matters & probing them. Congress' was a govt of scams & they established these scamsters, says MoS Finance SP Shukla
We were not in govt in 2011, if Congress is making allegations, were they sleeping from 2011-14? They should've probed it. This govt is taking cognizance of matters & probing them. Congress' was a govt of scams & they established these scamsters, says MoS Finance SP Shukla
Financial Services Secretary Rajeev Kumar said the adequate provisioning has been made towards PNB fraud transaction and he doesn't expect the case to escalate, reports CNBC-TV18
Congress is now addressing the media on the issue. The opposition suspects that the Prime Minister and his party members gave a tip-off to Nirav Modi. Randeep Surjewala, Congress Spokesperson, said that the PM was informed of the scam and why hasn't any action been taken. Earlier today, media reports have pointed that it is possible that NiravModihad political support and was hence was able to flee the country without coming under the radar earlier. Media reports also pointed that Nirav Modi was with the PM in the WEF summit in Davos.
The press conference has ended. On the other hand, Nirav Modi left the country on 1st of January. CBI received complaint from PNB on 29th Jan 2018. CBI registered the case on 31st January.
Lookout notices by the CBI have been issued to Nirav Modi and PNB officials, reports Moneycontrol's Tarun Sharma.
This is a standalone incident. It has taken place only in one of our branches, Mehta said.
PNBChief has confirmed that Nirav Modi wrote to them regarding the repayment plan. Mehta said that the bank has asked for a concrete repayment plan and according to that, will come to a conclusion.
Mehta has said that the bank will take full responsibility if the investigation places theonus on them.
When asked why the scam was taken seven years to unearth, Mehta said that the fraud was internally detected when a customer came for renewal on January 25.
As far as the bank is concerned we have the capacity and capability to come out of this situation, Mehta reiterated.
He said that mainly the international branches of Indian banks were involved.
This (the fraud) started in 2011. The bank itself detected on the January 25 and (it) was reported to the regulators, including the Securities and Exchange Board of India (SEBI) and law enforcement agencies to book the culprits and take strong legal action, Mehta said.
He asserted that the PNB employees who were involved in the fraud, have also been reported to the regulators, along with the creditors.
On the PNB FIR, he pointed that the media is fully aware of the developments involving their employees and branches under the scanner. He has asked for 'breathing time' to bring the culprits to limelight.
He said, "You are fully aware that we have kept the members involved in the developments. We have kept all the bankers aware of this situation."
PNBChief is addressing the media, in both English and Hindi. The fraud, he says, started in 2011. "PNBis committed in clean banking and that is why he reported it immediately to the regulators."
The PNBmanagement has entered for the press conference.
PNB MD & CEO Sunil Mehta will hold a conference call at 5:30 pm.
Nirav Modi suspected of laundering demonetised notes, sources told CNN-News18.
JUST IN| PNB MD & CEO Sunil Mehta to address the media shortly.
Priyanka Chopra, the brand ambassador for Nirav Modi, is suing Nirav Modi for not paying her for a diamond advertisement, reports Times Now.
Nirav Modi crashes
partyfor PSU banks! stay withNBFCsand private banks
PSU Banks which lost nearly Rs 20,000 crore in market capitalization on Wednesday afterPunjab National Bank(PNB) declared a fraud of over Rs1000 crore, 8 times its FY17 profit, spooked investors on D-Street.
Public Sector Banks (PSBs) which were making a comeback thanks to Reserve Bank of India’s (RBI) recapitalization plan and new non-performing asset (NPA) rules may have now lost the race to private banks as well as NBFCs which are now looking attractive from the investment perspective.
‘Stay away from PSU banks’, which is the word coming from experts on D-Street. The concern of most analysts is that nobody knows if it is the beginning or the end.
