The Punjab National Bank has had a massive stroke of bad luck, and the streak doesn’t look like it will stop anytime soon. Yet again, the bank has found itself the victim of a huge fraud, of an amount of as much as Rs. 3800 crores.
Time and again such frauds have been reported at the Punjab National Bank, ranging from data leaks to scammers looting the bank
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PNB Reports Rs. 3800 Scam
The Punjab National Bank admitted to reporting a fraud of Rs. 3800 crores to the Reserve Bank of India. There are around 12 fraudster accounts involved, one of which is detected to be Bhushan Power & Steel Ltd.
The amount, Rs. 3800 crore is inclusive of domestic exposure of ?3,191 crore, $49.71 million at the bank’s Dubai branch and $38.51 million at its branch in Hong Kong.
On the basis of the forensic audit and an FIR filed by the federal police, the bank has reported the “alleging diversion of funds from the banking system.”
PNB said, “On the basis of Forensic Audit Investigation findings and the CBI filing an FIR on a suo moto basis, against the company and its directors, alleging diversion of funds from the banking system, a fraud of ?3,805.15 core is being reported by the bank to the RBI.”
BSPL is one of the country’s most indebted companies and is accused of manipulating the accounts and books in order to make funds from consortium lender banks.
This is not the first time PNB has been scammed for such a huge amount. Here are the bank’s top three frauds:
The Nirav Modi Scam at PNB
Probably the biggest scam of the country, PNB is still healing from the gigantic impact of Rs. 11,400 crores in the Nirav Modi scam. The scam, which involved internal bank officials, technical shortcomings and a diamond merchant with flawed principles.
Officials from the jewelry brand asked PNB to issue credit for the sake of importing rough stones from abroad. However, these letters were misused to transfer a whopping Rs. 11,400 crore from the branches of Axis Bank and Allahabad Bank across various countries.
The Winsome Group Scam
A few years ago, a similar heist was carried out by yet another diamond merchant, the Winsome Group which was led by Jatin Mehta. They implemented a similar method to siphon money by using SLBCs, which are standby credit letters.
The Standard Chartered Bank led banking consortium extended an amount of Rs. 6800 crores in which, PNB faced a loss of Rs. 1600 crore in this fraud.
The Kanishk Gold Scam
There were many banks involved in this one, and the PNB bank faced a loss of Rs 115 crore. This fraud was brought to light by the Central Bureau of Investigation. The fraudster was a popular gold chain by the name, Kanishk Gold Pvt Ltd and the total fraud amounted to Rs. 824 crores.
The modus operandi of this fraud was to inflate inventory and take loans against the same asset for several times.
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