PNB fraud: ED continues raids, seizure value rises to Rs 5674 crore


Mumbai/New Delhi, Feb 17: Raids by the ED in connection with its money laundering probe against diamond czar Nirav Modi and others in the alleged Rs 11,400-crore bank fraud continued for the third day today with the agency saying it seized Rs 25 crore worth diamonds and jewellery, taking the total seizure value to Rs 5,674 crore.
"The ED conducted further searches at 21 locations across India in NiravModi case and seized diamonds, gold, precious stones/metals and jewellery worth Rs 25 crore (book value). The total seizure till now is Rs 5,674 crore," it said in a statement.
The agency had earlier said it had arrived at the value of the assets seized based on the stock value at showrooms and stores, which was also the price at which the company purchased the goods.
It was also conducting an "independent valuation" of these assets. The Enforcement Directorate had yesterday summoned NiravModi and his business partner and jewellery chain promoter MehulChoksi in this case. They have been asked to appear before the Investigating Officer of the case at the ED office in Mumbai on February 23.
According to the Central Bureau of Investigation, NiravModi and Choksi left the country in January, before an FIR was registered in the Punjab National Bank fraud case. The raids that began on February 15 are expected to continue tomorrow, ED officials said.
ED sleuths are also in touch with a former government-nominated director of a state-owned bank, who was a reported whistleblower in this case, as part of its investigation, they said.
The agency also filed a fresh money laundering case yesterday, taking cognisance of a new CBI FIR against Choksi and his companies.
The ED had first registered a PMLA case against the two, besides others, on February 14 based on a CBI FIR, on the basis of a Punjab National Bank complaint.
The agency is probing if the allegedly defrauded bank funds were laundered and these proceeds of crime subsequently used by the accused to create illegal assets and black money.
DiamantaireModi, 46, 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 PNB to the tune of Rs 280 crore.
The bank subsequently sent two more complaints to the CBI on Tuesday, saying the scam was worth more than Rs 11,400 crore.
The jewellery designer is understood to be a citizen of the country but his brother Nishal and wife Ami are not Indian nationals. They all left India between January 1 and 6, the CBI had said.
However, the CBI today arrested three people a retired and a serving officials of Punjab National Bank and an executive of NiravModi's company in connection with the alleged Rs 11,400-crore fraud, and carried out searches at the Brady Road branch of the bank in Mumbai, officials said.
The bank branch, which is in the centre of one of the biggest financial scams of the country, was searched by the agency, the sources said, adding that "incriminating documents" related to the case were recovered.
The officials at the branch were asked by CBI sleuths about the process of sending Swift messages notifications sent by banks to transfer funds internationally, and the functioning of internal software of the bank, they said.
The agency has taken into custody retired deputy manager of the bank GokulnathShetty, single-window operator Manoj Kharat, and HemantBhat in connection with its FIR registered on January 31 against NiravModi, his companies and business partner and uncleMehulChoski, they said.
The CBI is also questioning six officials of the bank, they said.
The FIR initially listed eight fraudulent transactions worth over Rs 280 crore, but based on further complaints from the bank, the CBI now says the amount investigated in the first FIR is over Rs 6,498 crore, involving 150 Letters of Understanding (LoUs) allegedly fraudulently issued by Shetty and Kharat.
The remaining 150 fraudulent LoUs worth over Rs 4,886 crore issued for Gitanjali Group are part of the second FIR registered by the agency against Choksi and his companies Gitanjali Gems, Nakshatra Brands and Gili, they said.
All these LoUs were issued or renewed during 2017-18, the officials said.
AnLoU is a letter of comfort given by a bank, a kind of guarantee, to a foreign branch of an Indian bank on behalf of its client allowing him to raise money from that bank for short-term credit.

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