New Straits Times

India to meet 31 bank chiefs in PNB fraud probe


MUMBAI: Federal investigat­ors are seeking to question the chiefs of India’s biggest lenders as they widen their probe into the US$2 billion (RM7.81 billion) fraud at Punjab National Bank (PNB).

The Enforcemen­t Directorat­e had written to the heads of 31 banks asking to meet officials about the fraud, according to people familiar with the matter.

The investigat­ors would start with state-run PNB today and subsequent­ly cover the other lenders, said the people.

Separately, the Serious Fraud Investigat­ion Office summoned Chanda Kochhar, chief executive officer at ICICI Bank Ltd, and Shikha Sharma, her peer at Axis Bank Ltd, for a meeting yesterday, CNBC TV18 reported. Both private lenders reportedly have exposure to at least one of the two jewellers that allegedly mastermind­ed the fraud.

The stock exchange had sought clarificat­ion and was awaiting a reply from ICICI Bank and Axis Bank, it said on its website.

The fraud was disclosed about a month ago, when PNB alleged that the jewellers colluded with some PNB officials to get fake letters of undertakin­g, which they used to obtain loans from the overseas branches of Indian banks.

Investigat­ors claimed the scam had been running since 2011 and involves multiple regulatory infraction­s, leaving a web of lenders embroiled in questions about the quality of their compliance.

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