PNB case: CBI arrests senior bank officer

Prime accused Nirav Modi’s Alibaug farmhouse sealed

The CBI yesterday said it has arrested a general manager-rank officer of the Punjab National Bank (PNB) in connection with the Rs113-billion (Dh6.4-billion) fraud and sealed diamond merchant Nirav Modi’s Alibaug farmhouse in Maharashtra.

Rajesh Jindal, who was holding the charge of Mumbai-based PNB’s Brady House branch between August 2009 and May 2011, was arrested on Tuesday night after daylong questioning in Mumbai.

The Central Bureau of Investigation (CBI) officials said the fraud perpetrated by the issuance of Letters of Understanding (LoUs) and Foreign Letters of Credit (FLCs) by PNB for sanction of loans to diamond merchant Nirav Modi and his uncle Mehul Choksi’s group of firms took place during Jindal’s tenure.

Jindal, presently posted as GM (Credit) at PNB’s Head Office in New Delhi, was heading the second largest branch of the PNB when the practice of issuing the LoUs without sanctioned limits began.

Jindal is the 12th accused to be arrested in the case so far. He was yesterday presented in a special CBI court in Mumbai which sent him to the agency’s custody till March 5, an official said.

The agency also sealed Nirav Modi’s Alibaug farmhouse spread over 1.5 acres near the Mumbai seashore, a day after a search by the CBI there.

The Enforcement Directorate (ED), which is also probing the PNB fraud case separately, yesterday carried out searches at 17 locations in Mumbai. It carried out searches at four firms suspected to be shell companies.

Officials connected to the case said the businessman bought the farmhouse in 2004 for Rs320 million in his name.