PNB hires lawyers for bankruptcy proceedings of Nirav Modi firm in US
PNB has hired lawyers to represent itself in the bankruptcy proceedings of the US-based Firestar Diamond, a group company of billionaire diamantaire Nirav Modi
New Delhi: State-owned Punjab National Bank (PNB) has hired lawyers to represent itself in the bankruptcy proceedings of the US-based Firestar Diamond, a group company of billionaire diamantaire Nirav Modi who is accused of defrauding the lender of over Rs13,000 crore.
Firestar Diamond approached a bankruptcy court in New York court in February. “We have just engaged lawyers to represent our bank in the US bankruptcy petition as part of recovery process. If money has gone from our system and parked in that company, our bank’s views should be heard before deciding about insolvency petition,” PNB Managing Director Sunil Mehta told PTI in an interview.
Without disclosing the name of the lawyers, he said the bank is legally engaged in the matter of insolvency proceedings of Firestar Diamond and the concerned authorities have been requested to make the bank a party in the case.
The US Trustee Program oversees the administration of bankruptcy cases in the United States. Modi and his uncle Mehul Choksi, in connivance with certain bank officials, allegedly cheated PNB of over Rs13,000 crore through fraudulent Letters of Undertaking (LoUs). A Mumbai branch of PNB had fraudulently issued LoUs 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. PNB had issued as many as 1,590 LoUs to Nirav Modi, Mehul Choksi and their associates. The total number of LoUs issued to the companies of Nirav Modi, his relatives and the Nirav Modi Group are 1,213, and to Mehul Choksi, his relatives and the Gitanjali Group are 377.
- Flipkart claims to have beat Amazon in fashion, mobile phones and large appliances during sale season
- SBI to block internet banking on accounts if mobile number not registered
- Climate change is threatening world’s beer supply
- Piramal Enterprises said to mull $1 billion contract pharma sale
- Infosys built its global machine with Indian workers. But what about ‘Hire Americans’?
- IndusInd Bank’s Q2 results show a peek into the IL&FS booby trap
- So which liquid, money market funds did investors flee from in September?
- Dr Reddy’s: API unit sale should lower costs, may not be a windfall
- Demerger in final leg, CESC stock yet to reflect value unlocking benefits
- Banks turned wary of NBFCs months before IL&FS defaults