As the details of the murky deals in the PNB fraud case are pouring in, it is learned that Indian banks stand to lose a whopping $ 3 billion from loans and corporate guarantees according to the assessment of the Income Tax Department.
The said amount was provided to the jewellery and diamond syndicates owned by and related to Nirav Modi and Gitanjali Group promoter Mehul Choksi which snowballed into the biggest bank fraud the country has witnessed with the state-run Punjab National Bank (PNB) at the centre.
The Income Tax Department informed that the banks had provided loans and guarantees valued at Rs 17,632 crore to businesses attached to the diamond czar Nirav Modi and Mehul Choksi till as late as March 2017.
The total amount in the form of loans and guarantees since March 2017 may well exceed $3 billion in a total hit to Indian banks.
The PNB has said that two of its junior officials posted at a Mumbai branch issued Letters of Undertaking to firms linked to Modi and Choksi to facilitate obtaining credit from overseas branches of other Indian lenders.
If sources are to be believed Geetanjali Gems and its subsidiaries were dealing with as many as 32 banks at a given time.
The CBI and Enforcement Directorate (ED) are preparing judicial requests to be sent to different countries to verify details of at least 12 companies which received payments from banks against import bills.
Raids by the ED in connection with its money laundering probe against Nirav Modi and others in the bank fraud continued for the third day on Saturday with the agency saying it seized Rs 25 crore worth diamonds and jewellery.
''The ED conducted further searches at 21 locations across India in Nirav Modi case and seized diamonds, gold, precious stones/metals and jewellery worth Rs 25 crore (book value). The total seizure till now is Rs 5,674 crore," it said in a statement.