The CBI on Wednesday filed its charge sheet against billionaire jeweller Mehul Choksi and 17 other entities, including companies owned by him and other individuals, in connection with the over $ 2 billion Punjab National Bank (PNB) scam, officials said.
The charge sheet was filed before a special CBI court in Mumbai.
In the charge sheet, pertaining to an FIR against Choksi, the Gitanjali group of companies and 16 other entities (including companies and individuals), the agency has slapped charges of criminal conspiracy, cheating and under the provisions of the Prevention of Corruption Act, the officials said.
They added that this was a separate chargesheet from the one filed on May 14 against Choksi’s nephew Nirav Modi and stressed that the present chargesheet pertained to the FIR against Choksi.
Supplementary chargesheets against Modi will also be filed soon, they said.
The FIR was lodged on the basis 0f a complaint from the PNB, dated February 13.
According to it, the alleged loss to the bank was over Rs 4,886 crore, arising out of 143 Letters of Undertaking (LoUs) and 224 Foreign Letters of Credit issued to the companies of Choksi, the officials said, adding that the total loss, allegedly perpetrated by the jeweller and his nephew Modi — both absconding — was over USD 2 billion.
It is alleged that the accused PNB officials, in a conspiracy with private persons, had sent the unauthorised LoUs and Foreign Letters of Credit to overseas branches of Indian banks for release of funds to the accused companies’ suppliers or to clear the liabilities of the accused companies.
The accused PNB officials allegedly did not enter the instructions for these LoUs in their internal software to avoid scrutiny. They were sent through an international messaging system for banking called SWIFT, used to pass instructions among banks globally to transfer funds.
An LoU is a guarantee given by an issuing bank to Indian banks that have branches abroad to grant short-term credit to an applicant.
In case of default, the bank issuing the LoU has to pay the liability to the credit-giving bank..