The Central Bureau of Investigation on Thursday accused an internal auditor at a Mumbai branch of Punjab National Bank of conspiring with other officials to carry out the alleged Rs 12,700-crore fraud at the bank. The agency made the charges in a filing to a Mumbai court, a day after it arrested the auditor, MK Sharma, during an investigation into the alleged fraud.
The court sent Sharma, the internal chief auditor at the Brady House branch, to police custody until March 13, Reuters reported. On Thursday, the CBI arrested another former bank official, Bishnubrata Mishra, who was the internal chief auditor between 2011 and 2015 at the Brady House branch, ANI reported.
The Brady House branch in south Mumbai is at the centre of the scam.
Sharma was responsible for verifying daily transactions and reporting irregularities, CBI Inspector D Damodaran told the court. However, he “deliberately ignored” the illegal letters of undertaking that were issued for companies linked to businessmen Nirav Modi and Mehul Choksi, the agency said.
Sharma’s lawyer said his client “had no opportunity to know” about the irregularities as he did not have access to the interbank SWIFT infrastructure.
Meanwhile, the CBI continued its searches in connection with the scam on Thursday, PTI reported. It also questioned 13 more people in the case.
On Wednesday, the agency had said it had written to Modi, asking him to return to India and cooperate with the investigators. However, Modi wrote back saying he cannot as he has a business to take care of outside India. Choksi is also currently abroad.
The Punjab National Bank had informed the Bombay Stock Exchange on February 14 that it had detected “fraudulent and unauthorised transactions” at its Brady House branch in Mumbai. The bank accused Nirav Modi and Mehul Choksi of defrauding it of Rs 11,380 crore by allegedly acquiring fraudulent Letters of Undertaking from the branch for overseas credit from other Indian lenders. It later said the amount of fraudulent transactions could be Rs 12,703 crore.
Some other officials of Punjab National Bank have also been arrested and are undergoing investigation.
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