Financial services secretary updates Jaitley on PNB case

NEW DELHI: The Rs 11,400 crore fraud in Punjab National Bank (PNB) came to light because of the government’s pressure to clean up the banking system, Financial Services Secretary Rajiv Kumar said today after updating Finance Minister Arun Jaitley on the case.
The country’s second largest lender PNB has detected a USD 1.77 billion (about Rs 11,400 crore) scam where billionaire jeweller Nirav Modi allegedly acquired fraudulent letters of undertaking (LoUs) from a branch in Mumbai to secure overseas credit from other Indian lenders.

The alleged fraud, which has been going on since 2011, came to light only in January this year.

Talking to reporters after meeting Jaitley along with senior bank officials, Kumar said the fraud transaction came to light “because of the pressure” from the government.

“If it (LoUs) was to get rolled over, it would have got rolled over this time also,” he said, adding the next roll over came to notice on January 23.

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