CBI CHARGESHEET AGAINST CHOKSI, GITANJALI GEMS
The Central Bureau of Investigation (CBI) on Wednesday filed its second charge sheet against Gitanjali Gems, its promoter Mehul Choski and 16 others for causing a loss of ~70.8 billion to Punjab National Bank (PNB) by fraudulently availing credit facilities between 2015 and 2017. This follows government action against three former and incumbent officials of PNB, former managing director and chief executive officer Usha Ananthasubramanian and executive directors K V Brahmaji Rao and Sanjiv Sharan, who were named in the first charge sheet on Monday.
The Central Bureau of Investigation (CBI) on Wednesday filed its second chargesheet against Gitanjali Gems, its promoter Mehul Choksi and 16 others for causing a loss of ~70.8 billion to Punjab National Bank (PNB) by fraudulently availing credit facilities between 2015 and 2017.
This follows government action against three top former and incumbent officials of PNB, including former managing director and chief executive officer Usha Ananthasubramanian and executive directors, K V Brahmaji Rao and Sanjiv Sharan, who were named in the first chargesheet filed by the agency on Monday in the ~65-billion fraud related to Nirav Modi group of companies.
These officials were named again in the Central Bureau of Investigation's 12,000-paged second prosecution report. This chargesheet covered 142 fraudulent letters of undertaking (LoUs) and 58 foreign letters of credit (FLCs) worth ~70.8 billion. Of these, Choksi was issued six LoUs and six FLCs amounting to ~5.12 billion.
The accused have been charged under Sections 409 (criminal breach of trust by a public servant, banker or merchant) and 420 (cheating and dishonestly inducing delivery of property) of the IPC.
So far, CBI investigations have established total committed fraud of ~135 billion.
“It was alleged that the accused persons had hatched a ‘criminal conspiracy’ among themselves and defrauded PNB to the tune of ~70.8 billion for fraudulently issuing LoUs to overseas banks for obtaining buyers’ credit and also issuing FLCs in favour of three Choksi companies without any sanction limit and without making entries in the bank’s central banking system,” said CBI in the charge sheet.
According to sources, the probe agency would file a supplementary chargesheet by the end of this month, which could establish the remaining fraud amount.
The CBI investigation has revealed that the fraud was allegedly perpetrated despite knowledge of senior PNB officials, who did not implement the Reserve Bank of India’s (RBI’s) circular regarding safeguarding the SWIFT (Society for Worldwide Interbank Financial Telecommunications) operation and instead, misrepresented the factual situation to the RBI.
During the investigations, the CBI conducted searches at 52 premises, arrested five people based on the second first information report filed by the agency.
The CBI has filed three separate cases and the total fraud in the Nirav Modi case — perpetrated by misusing SWIFT systems — has been put at ~140 billion.
The central bank has since then discontinued LoUs as a credit facility instrument.