Nirav Modi and his firms got 1,213 fraud LoUs

PNB informed the Department of Financial Services regarding the fraud on February 6.

Nirav Modi and his firms got 1,213 fraud LoUs

Jeweller Nirav Modi and his group of companies got 1,213 fraudulent Letters of Undertakings between 2011 and 2017 from Punjab National Bank's Brady House branch in Mumbai, Finance Minister Arun Jaitley told the Rajya Sabha on Tuesday.

The list of LoU given by him, however, reveals that most of them were sanctioned in between 2014-2017. The last fraudulent LoU was issued on May 23, 2017.

In a written reply to a question in the RS, Jaitley said that PNB head office received a report of suspicious outstanding of unauthorised transactions from circle office, Mumbai on January 23. Immediately an investigating team was constituted which gave its preliminary report on January 25. On January 29, the fraud was reported to the RBI and complaint lodged with CBI Mumbai.

PNB informed the Department of Financial Services regarding the fraud on February 6.

He said that between 2011 and 2017, at least 53 genuine LoUs were also issued to Nirav Modi Group.  In an answer to another question, Minister of State for Finance Shiv Pratap Shukla said the RBI had issued two circulars to banks, related to security and operational controls in SWIFT environment, in August and November 2016.

The RBI had issued instructions mandating banks to implement, within stipulated deadlines, prescribed measures for strengthening the SWIFT operating environment in banks.

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