2 PNB EDs fired for Nirav scam

A FINANCE ministry notification alleged that there were procedural lapses on part of both the EDs as they fail to take cognisance of the RBI advice of linking SWIFT with the bank’s CBS system

New Delhi, Jan. 20: The government has sacked two executive directors of Nirav Modi scam-hit Punjab National Bank (PNB) for their alleged failure in exercising proper control over the functioning of the bank.

Their services were terminated from January 18, as per the finance ministry notification.

The Central government has removed K.V. Brahmaji Rao and Sanjiv Sharan from the office of executive director (ED) of PNB with immediate effect, it said.

It is alleged that there were procedural lapses on part of both the EDs as they fail to take cognisance of the Reserve Bank of India advice of linking SWIFT with Core Banking Solution (CBS) system of the bank. The circular was issued in 2016. Some banks implemented the directive, while some, including PNB, did not.

Mr Rao was to retire this month, while Mr Sharan was to superannuate in May this year.

In August last year, the government dismissed Allahabad Bank’s Usha Ananathasubramanian in connection with country’s biggest bank fraud allegedly carried out by Nirav Modi and associates at PNB. She was MD and CEO of PNB before moving to Allahabad Bank.

Modi and his uncle Mehul Choksi, in conni-vance with certain bank officials, allegedly cheated PNB of about `14,000 crore through issuance of fraudulent letters of undertaking. A Mumbai branch of PNB had fraudulently issued LoUs for the group of companies belonging to Modi since March 2011.

The total number of LoUs issued to the companies of Nirav Modi, his relatives and the Nirav Modi Group are 1,213, and to Mehul Choksi, his relatives and the Gitanjali Group are 377.