The CBI is likely to approach Interpol for a Red Corner Notice against absconding billionaire jewellers Nirav Modi and Mehul Choksi who are allegedly the brains behind the over USD 2 billion scam in Punjab National Bank, agency sources said. Modi along with his wife Ami, a US citizen, brother Nishal a Belgian, and uncle Choksi, Gitanjali group’s promoter, had fled the country before the bank approached the CBI with a complaint against his companies for allegedly cheating through fraudulent issuance of Letters of Undertakings (LoUs) and Foreign Letters of Credit (FLCs). The agency recently chargesheeted both Modi and Choksi separately in the scam and will now approach the Interpol for a Red Corner Notice aimed at bringing them back for facing trial in the cases against them, the sources said.
The PNB had approached the CBI with a complaint on the basis of which the agency had registered an FIR against Modi. The agency had immediately issued a diffusion notice with the Interpol to track Modi and Choksi but their whereabouts remain unknown, the sources said. They said the Red Corner Notice will allow enforcement agencies of the member countries of Interpol to try to find and arrest them in their respective countries.
The CBI, in its chargesheets filed last week, alleged that Modi, through his companies, siphoned off funds to the tune of Rs 6,498.20 crore using fraudulent LoUs issued from PNB’s Brady House branch in Mumbai. Choksi swindled Rs 7080.86 crore, making it possibly the biggest banking scam in the country, it alleged. An additional loan default of over Rs 5,000 crore to Choksi’s companies is also a matter of probe under the CBI.
It is alleged that Modi and Choksi through their companies availed credit from overseas branches of Indian banks using the fraudulent guarantees of the PNB given through LoUs and letters of credit which were not repaid bringing the liability on the state-run bank, the officials said. An LoU is a guarantee given by an issuing bank to Indian banks having branches abroad to grant short-term credit to the applicant.
The instructions for transferring the funds were allegedly issued by a bank employee, Gokulnath Shetty, using an international messaging system for banking called SWIFT platform and without making their subsequent entries in the PNB’s internal banking software, thus bypassing scrutiny in the bank, they said.