‘Firm cooked books of accounts to raise funds from consortium lender banks’
Public sector lender Punjab National Bank said on Saturday it had detected a fraud worth more than ₹3,800 crore by Bhushan Power & Steel Ltd. (BPSL), and has reported it to the Reserve Bank of India (RBI).
PNB said Bhushan Power & Steel Ltd. misappropriated bank funds and manipulated its books of accounts to raise funds from consortium lender banks. “On the basis of forensic audit investigation findings and CBI filing FIR, on suo moto basis, against the company and its directors, alleging diversion of funds from banking system, a fraud of ₹3,805.15 crore is being reported by the bank to the RBI,” the bank said in a regulatory filing.
“It has been observed that the company has misappropriated bank funds, manipulated books of accounts to raise funds from consortium lender banks. At present, the case is at NCLT, which is in an advanced stage and the bank expects good recovery in the account,” it added.
The bank had made provisions amounting to ₹1,932.47 crore, as per prescribed prudential norms, for the BPSL account. PNB said its domestic exposure to Bhushan Power & Steel Ltd. (BPSL) stood at ₹3,191.51 crore and overseas exposure of $49.71 million (approx ₹345.74 crore) at the Dubai branch and $38.51 million (approximately ₹267.90 crore) at the Hong Kong branch.
Directive to Nirav Modi
Separately, the Debt Recovery Tribunal in Pune has directed fugitive diamond merchant Nirav Modi, currently in a London prison, and his aides to pay more than ₹7,200 crore with interest to the defrauded PNB. Mr. Modi is wanted in India as the main accused in the $2-billion PNB fraud and money laundering case.
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