The Central Bureau of Investigation arrested MK Sharma, the internal chief auditor of Punjab National Bank, in the Rs 12,700-crore fraud involving billionaire jeweller Nirav Modi.
Sharma was allegedly responsible for auditing the systems and practices of PNB’s Brady House branch and report deficiencies to the zonal audit office, a spokesperson for the CBI said today.
Modi and his companies obtained loans based on allegedly fraudulent guarantees issued by some of the employees of the branch, according to the first information report filed by the CBI. As a fallout of the fraud, the Finance Ministry yesterday gave state-owned banks a 15-day deadline to develop a blueprint to deal with such operational challenges and technological risks. Investigations are still on and the Enforcement Directorate has seized assets of both Modi and Mehul Choksi of Gitanjali Gems Ltd.
The search and seizures are almost complete, an official at the Enforcement Directorate told BloombergQuint requesting anonymity. The agency has seized both Modi and Choksi’s assets worth about Rs 6,200 crore, including luxury cars, imported watches, and shares and mutual funds of their companies. Independent valuation of the assets is still on and will take some time, the official said.
The Enforcement Directorate has so far issued three summons to Modi and Choksi but they haven’t appeared before the investigating agency. It also approached the PMLA court to issue a non-bailable warrant against Modi.