Punjab National Bank complains to CBI about ₹10,000 cr shady transactions in a Mumbai branch

The CBI has received two complaints from PNB against the billionaire jewellery designer Nirav Modi and a jewellery company about fraudulent transactions worth ₹10,000 crore

Photo courtesy: social media
Photo courtesy: social media


Punjab National Bank, the second largest public sector bank in India, has detected a $1.8 billion fraud in one of its branches, the bank said in a regulatory filing to the stock exchanges on Wednesday.

"The bank has detected some fraudulent and unauthorised transactions (messages) in one of its branch in Mumbai for the benefit of a few select account holders with their apparent connivance," the filing by the bank said. It had quoted the quantum of such transactions was to the tune of around $1,771.69 million (around ₹11,515 crore).

Punjab National Bank complains to CBI about  ₹10,000 cr shady transactions in a Mumbai branch
A copy of the letter by PNB submitted to SEBI

The amount of fraudulent transactions is equivalent to eight times the bank's net income of about ₹1,320 crore ($206 million).

This case has happened at a time when the Indian banking system is already grappling to tackle its swelling non-performing assets.

"Based on these transactions other banks appear to have advanced money to these customers abroad. In the bank these transactions are contingent in nature and liability arising out of these on the bank shall be decided based on the law and genuineness of underlying transactions," the filing said.

The bank informed: "The matter is already referred to law enforcement agencies to examine and book the culprits as per law of the land."

On February 5, the Central Bureau of Investigation had booked billionaire diamond service provider Nirav Modi, his brother, wife and an enterprise companion for allegedly cheating Punjab National Bank of over ₹280.70 crore last year.

Following the complaint, the CBI registered a FIR under the Indian Penal Code sections related to criminal conspiracy, cheating and provisions of the Prevention of Corruption Act against the four.

The stock of Punjab National Bank was trading at ₹149.20 per share, down 7.70 per cent at the BSE at 1.59 p.m.

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Published: 14 Feb 2018, 2:17 PM