New Delhi: All public sector banks have verified LoUs issued by them, and there are no other unauthorised authority letters except for those issued by Punjab National Bank, a senior SBI official said here on Thursday. Billionaire jeweller designer Nirav Modi and his uncle Mehul Choksi in connivance with certain bank officials allegedly cheated the PNB of Rs 12,968 crore through fraudulent Letters of Undertaking (LoUs).
Earlier this week, the Reserve Bank has stopped banks from issuing LoUs and Letters of Comfort for trade finance for imports into the country. All the chief technical officers (CTOs) and chief risk officers (CROs) of the PSBs are participating in a workshop here, which is coordinated by SBI on the issues of Operational and Technological Risk Management.
"Each bank has already scanned their LoU/LoC related transactions and have confirmed that all of them are properly assessed, genuine and accounted for except those reported," said M S Sastry, Deputy MD of SBI said in a press briefing.
Further controls have also now have been put in place that included an additional layer of approvals for all outward swift message, integration of SWIFT with CBS (core banking solution) latest by April 30, 2018 besides time restrictions for such transactions that is between 9 am to 8 pm only, he added. The Mumbai branch of Punjab National Bank had issued as many as 1,213 letters of undertaking (LoUs) fraudulently for the group of companies belonging to Nirav Modi since March 2011.
Different investigating agencies, including CBI and Enforcement Directorate, are probing the fraud, dubbed as the biggest banking scam in the country. Both houses of Parliament have witnessed repeated disruptions over the issue.
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