Published: Wed, March 07, 2018
Sport | By Floyd Cook

ICICI's Chanda Kochhar and Axis Bank's Shikha Sharma summoned in PNB scam

ICICI's Chanda Kochhar and Axis Bank's Shikha Sharma summoned in PNB scam

Separately, the Serious Fraud Investigation Office (SFIO) had summoned Chanda Kochhar, Chief Executive Officer at ICICI Bank, and Shikha Sharma, her peer at Axis Bank, for a meeting on Tuesday, according to media reports. NS Kannan, official chief ICICI bank, was the pioneer of consortium of the bank that loaned cash to Gitanjali Group, it has been asserted.

Earlier in the day, the Central Bureau of Investigation detained the vice president of banking operations at the Gitanjali Group, Vipul Chitalia, at the Mumbai airport for questioning.

SFIO has summoned consortium of 31 banks that include ICICI, Axis and PNB.

Though Nirav Modi (R) has not yet been arrested, India's External Affairs Ministry has revoked his passport as well as his uncle Mehul Choksi (L) for their involvement in the scam.

The SFIO has written to the top managements of all the lenders who have either given loans or extended any other services, sources said, adding that the total number could be around 35.

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"We have no exposure to the Nirav Modi group of companies". The SFIO also issued letters to select banks, asking them to explain the working capital facility given to Gitanjali Group.

"In the normal course of trade business, the bank, through the overseas branches, undertakes transactions against LoUs (Letters of Undertaking) issued by other banks". PNB has lent Rs 587 crore as working capital, while ICICI Bank has lent Rs 405 crore to Mr Choksi's firms.

In case of default the bank issuing the LoU has to pay the liability. Prominent among 31 banks in the Consortium which played a role in the grant of these loans were ICICI Bank and Axis Bank.

After the state-owned Punjab National Bank, which is the epicentre of the fraud, two of the country's leading private sector banks - ICICI Bank and Axis Bank - are now under the scanner.

The jewelers are accused of getting letters of undertaking (LoUs) based on fraudulent claims from PNB, which bank officials did not enter in their internal software to avoid scrutiny.

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