PNB scam: Punjab National Bank's chief internal auditor held by CBI

The official is from PNB's Brady House branch, where the scam occurred

While billionaire jeweller Nirav Modi is still at large, the Central Bureau of Investigation (CBI) has made another arrest in the ongoing investigation of the cases against the Modi and Gitanjali groups. On Wednesday, CBI arrested an internal chief auditor of Punjab National Bank (PNB).

As per officials, the arrested auditor, identified as MK Sharma, is of the chief manager rank (scale IV PNB officer). He was allegedly responsible for auditing the systems and practices of PNB's Brady House branch and reporting the deficiencies to Zonal Audit Office, which he failed to do. The arrested accused will be produced in court today.

Nirav Modi

Scam gets bigger
Meanwhile, it has also emerged that the scam involving Modi and his uncle Mehul Choksi of the Gitanjali group has gotten bigger by R1,000 crore, with investigating agencies suspecting PNB had issued new letters of undertaking (LOU). Officials in the enforcement directorate (ED) said as per the probe, the LOUs were issued by PNBs Brady House branch since 2008. During the probe, new LOUs were found and they were probing how many fresh ones were issued. The scam has now reached almost R12,400 crore, with officials saying they have not ruled out another increase in its magnitude.

All assets seized
ED has almost completed seizing Modi and Choksi's assets in India. Their total worth is around Rs 6,500 crore. This includes jewellery, cars, watches, shares, mutual funds, properties and bank accounts. Officials said they were still checking if there is anything more, but prima facie this seems to be it. In all, 21 immovable properties of Modi and his company, including his Alibaug farm house and other properties in south Mumbai have been attached; the worth of these properties is over Rs 523 crore.

ED is now in the process of issuing letter rogatories (LR) to six different countries - Singapore, Hong Kong, UAE, USA, UK and South Africa, asking them to seize Modi and Choksi's overseas assets.

Focus on other officials
Next in the probe, ED would now be questioning bank officials from several private and government banks to understand their lending procedure. Most of these banks had loaned money to PNB, which PNB repaid by borrowing from a third bank. Officials said these bank officials were not suspects, but their statements were being recorded to understand the system and procedure used to lend money.

Also read - PNB scam: Mumbai Court summons Nirav Modi on March 12

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