Govt Suspends 2 PNB Executives Over Nirav Modi Fraud

News World India | 0
| January 20 , 2019 , 16:29 IST

The Finance Ministry has suspended two executive directors of Punjab National Bank over Nirav Modi scam.

The government took the step for their alleged failure in exercising proper control over the functioning of the bank. As per the Finance Ministry notification, their services were terminated from January 18.

The central government has removed KV Brahmaji Rao and Sanjiv Sharan from the office of Executive Director (ED) of PNB with immediate effect, it said.

It is alleged that there were procedural lapses on part of both the EDs as they fail to take cognisance of the Reserve Bank of India advice of linking SWIFT (Society for Worldwide Interbank Financial Telecommunication) with Core Banking Solution (CBS) system of the bank.

The circular was issued in 2016. Some banks implemented the directive, while some did not, including PNB.

Modi and his uncle Mehul Choksi, are accused involved in the Punjab National Bank money laundering scam of  Rs.14,000 crore who fled the country with his wife in the first week of January before the announcement of the scam.

A Mumbai branch of PNB had fraudulently issued LoUs for the group of companies belonging to Modi since March 2011.

The total number of LoUs issued to the companies of Nirav Modi, his relatives and the Nirav Modi Group is 1,213, and to Mehul Choksi, his relatives and the Gitanjali Group are 377. 

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The CBI has already filed charge sheet in this case. The charge sheet has mentioned names of many employees and top management, including former MD and EDs of the bank. 

KV Brahmaji Rao was to retire this month, while Sanjiv Sharan was to superannuate in May this year.