Cong trains guns at Modi govt; says ‘Bank Loot Scam’ totals ₹21,306 crore   

As many as 30 banks with total exposure of Rs 21,306 crore; PM Modi knew Mehul Choksi, one of the accused who has fled, alleged the Congress in a press conference on Friday on the Nirav Modi-PNB Scam

NH Photo by Vishwadeepak
NH Photo by Vishwadeepak


India's biggest 'Bank Loot Scam' has got even bigger, with the total exposure reaching ₹21,306 crore over the last 24 hours as the layers of conspiracy get unravelled by the hour, alleged Congress party officials in a press conference in Delhi on Friday.

Punjab National Bank (PNB) has already admitted exposure of ₹11,400 crore in the 293 'Letters of Understanding' (LoUs). In addition, exposure of 30 banks in loans extended to four companies, namely 'Firestar International Private Limited', `Firestar Diamond Fze', `Gitanjali Gems Limited' and 'Gitanjali Exports Corporation' is ₹9,906 crore. Thus, total exposure works out to ₹21,306 crore, said the Congress.

PNB’s stock has also depreciated radically ever since the scam came to light, wiping out ₹7,000 crore in value. Incidentally, the Centre owns 57% shares in PNB and the remaining is owned by financial institutions/common investors. If you add the erosion of the monetary value, total exposure comes to ₹28,306 crore.

In addition, exposure of banks to three more companies, namely Diamonds RUS, Solar Exports and Stellar Diamonds, is yet to be disclosed by the banks and the Modi government. Experts estimate this exposure to be in the range of between ₹ 3,000 and ₹5000 crore. This will take the total figure of the scam much higher, said Congress.

“No wonder, 'UDAAN' is the buzzword of the Modi Government, wherein every scamster can 'fleece and fly' — 'unchecked and undetected' ” read a press communication released by the Congress party.

The Congress has further alleged that the Modi Government ie the Prime Minister's Office, Enforcement Directorate, Ministry of Corporate Affairs, Serious Fraud Investigation Office (SFIO), SEBI as well as the state governments of Maharashtra and Gujarat were aware of the ongoing scam pursuant to a series of complaints filed as early as on May 7, 2015.

A complaint dated May 7, 2015, was filed with the Ministry of Corporate Affairs by one Shri Vaibhav Khuraniya & RM. Green Solution Private Limited. Copies of the same were also sent to the Prime Minister's Office, Enforcement Directorate and the Serious Fraud Investigation Office, said Congress.

Image courtesy: AICC
Image courtesy: AICC
A copy of the complaint filed by Vaibhav Khuraniya to Ministry of Corporate Affairs and serious fraud investigation office

A similar complaint was filed with the Deputy Commissioner of Police, Mumbai.

Another person named Digvijaysinh Jadeja filed an FIR in Ahmedabad Economic Offences Wing, Gujarat, against Mehul Choksi and others for defrauding him. The matter went to Gujarat High Court, where the Government of Gujarat was a party. In Special Criminal Application No. 4758 of 2015, Digvijaysinh Jadeja filed an affidavit on July 20, 2016, specifically pointing out that Mehul Choksi and others owed a debt of ₹9,872 crore to banks and are likely to escape from India.

Image courtesy: AICC
Image courtesy: AICC
Excerpt from the affidavit filed in Guajarat High Court by Digvijay Singh Jadeja

A complaint dated July 26, 2016, was filed by one Shri Hariprasad [SV Hari Prasad] with the Prime Minister's Office, which has already been placed in public domain. On May 3, 2017, Shri Vaibhav Khuraniya also emailed the complaint, which was duly registered. So everyone in the Government of India, including the Prime Minister's Office was aware of the fraud being committed, alleged Congress. Congress Spokesperson Randeep Surjewala in a tweet asked the government why it is denying that PM Modi met Nirav Modi in Davos:

Nirav Modi is seen in a business delegation in Davos, Switzerland posing with the PM for pictures. Law Minister Ravi Shankar Prasad says Nirav Modi was not part of any delegation though the MEA itself tweeted a picture of Modi with the delegation in Davos where Nirav Modi can be seen right behind the PM. A PTI report on January 13 included Nirav Modi among several other businessmen who were part of a contingent lead by Finance Minister Arun Jaitley to the World Economic Forum in Davos, Switzerland.

Does the Prime Minister know Mehul Choksi? Of course, his government says no. To add to the embarrassment of the Modi government, Congress at the press conference said a video has surfaced where, at an public event on 'Gold Monetization Scheme', Prime Minister Narendra Modi publicly acknowledges Mehul Choksi. The video on that event released at the press conference on Friday can be seen below:

Now, let’s look at how the duo and their family members slipped out of India. Nirav Modi left India on January 1, 2018. His maternal uncle and co-accused, Mehul Choksi, left India on January 4. Nirav Modi's wife, Ami Nirav Modi, and brother, Nishal Modi, left India on January 6. Nirav Modi conveniently attended the World Economic Forum in Davos between January 23 and 26, 2018 after escaping from India. CBI registered a case only on January 31, 2018 and issued a Look Out Notice finally on February 15, 2018. These dates themselves tell the story about 'The Great Escape'.

Every bank goes through four kinds of audit ie Statutory Audit (Looks into bank's balance sheet), Internal Audit (conducted by bank staff), Concurrent Audit (Audit of Bank transaction) and RBI Inspection. Despite this, the entire fraud escaped everybody's attention. Obviously, someone was protecting this network of fraud, alleged Congress.

On June 7, 2016, rating agency CARE withdrew the ratings assigned to the bank facilities of Firestar International Private Limited. The banks ignored it completely for unexplained reasons, alleged Congress.

Congress also demanded answers to a few pertinent questions from the government.

  • Has the size of bank loot scam peaked to ₹21,306 crore?
  • What is the quantum of total loss to banks?
  • Did the Prime Minister, PMO, ED, Corporate Affairs Ministry, SFIO, SEBI and Governments of Maharashtra and Gujarat have prior knowledge of the scam as early as on May 7, 2015? Why did they not take any action?
  • Does the Prime Minister know the accused Mehul Choksi? If yes, why is his government denying it?
  • Did the PMO, PIB and MEA not tweet the picture of the PM with the Business Delegation that included Nirav Modi?
  • Did the Modi government and agencies permit Nirav Modi, Mehul Choksi and others to escape from India?
  • How did the entire fraud escape the four stage audit system of the banks?
  • Why did the banks not become alert despite the withdrawal of ratings by rating agency CARE?

These are a few questions the Modi government ought to answer, said Congress, adding that if the government does not answer, people will know that they were, for sure, hand-in-glove in this loot of people’s money, unprecedented in the history of the nation.

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Published: 16 Feb 2018, 7:15 PM