PNB, Allahabad Bank boards may decide on further action against EDS, MD

Punjab National Bank and Allahabad Bank may take a call on further action to be brought against two executive directors and the MD chargesheeted in the Rs 14,000 crore Nirav Modi fraud case, sources said.

Soon after Central Bureau of Investigation (CBI) filed charge sheet in May pointed involvement of top officials of banks, PNB’S board decided to divest two executive directors of all powers.

According to the sources, PNB’S Board is scheduled to meet on Monday and decide about the future course of action against its two executive directors K V Brahmaji Rao and Sanjiv Sharan.

The Allahabad Bank too would follow suit, they said.

The CBI in its first charge sheet in the country’s biggest financial by billionaire jeweller Nirav Modi also detailed the alleged role of the PNB’S former chief Usha Ananthasubramanian, who is now Allahabad Bank CEO and MD.

The board of Allahabad Bank divested Ananthasubramanian from all her functional responsibilities after the first charge- sheet in May itself.

Experts feel that since the charges are restricted to procedural lapses without any criminal intent, the board will decide in that light.

It is also noted that PNB has claimed that it did not receive an essential e-mail on preventing bank frauds, which was sent by the Reserve Bank of India (RBI).

The directive, issued on November 30, 2016, mandated all commercial banks in the country to strengthen their risk control mechanisms to ward off banking frauds, was not received by PNB, as per the internal report of the bank.

Nirav Modi and his uncle Mehul Choksi, in connivance with certain bank officials, allegedly cheated PNB of about Rs 14,000 crore through issuance of fraudulent Letters of Undertaking (Lous).