CBI set to file fresh charges in $2 billion Punjab National Bank fraud case

Mumbai: The Central Bureau of Investigation (CBI) will soon file fresh charges in the $2 billion Punjab National Bank (PNB) fraud case and detail how the alleged wrongdoing was carried out, according to a source with direct knowledge of the matter.

In the police’s initial charges, billionaire jeweller Nirav Modi, 21 other people, including PNB officials, and three Modi companies were accused of being involved in fraudulent transactions that led to losses of roughly Rs 65 billion for PNB.

Three other Modi employees, a PNB officer, and a relative of Modi's are now also likely to be charged, said the source, who asked not to be identified as the charges have yet to be made public.

“The investigating officer’s report is in and the chargesheet is ready. It is being reviewed by the head office,” said the source.

CBI did not immediately respond to a request for comment.

PNB, India’s second-biggest state-run bank, in 2018 alleged that a few rogue employees had issued fake bank guarantees over several years to help jewellery groups — controlled by Modi and his uncle Mehul Choksi — raise funds in foreign credit. Both have denied any wrongdoing.

Modi was arrested in London in March and is currently fighting extradition to India. Police filed their first charges in May last year and at the time detailed only some of the alleged fraudulent transactions to Modi and his associates.

The new chargesheet will include 150 transactions and provide details on how fake bank guarantees were used to funnel funds between countries and dummy companies, the source said.

A separate second chargesheet against Choksi and his associates, is still pending and will take time as police link 142 other transactions to that case, another source told Reuters on condition of anonymity.

PNB has said losses related to Choksi and his associates were more than Rs 70 billion. PNB and a lawyer for Modi and Choksi did not immediately respond to Reuters’ requests for comment on Thursday.

The first source said that while the employees of Modi would be being charged with facilitating the funnelling of funds, Modi’s relative would be charged with destruction of evidence.