Decisions by India’s top law firm are being reviewed by officials from the Central Bureau of Investigation (CBI), who have been probing the US$2-billion scam at Punjab National Bank (PNB) since January.
Law firm Cyril Amarchand Mangaldas is being scrutinized by the CBI after they seized documents related to the Punjab bank from CAM’s premises in February, a media agency has reported.
Diamond merchant Nirav Modi and his uncle Mehul Choksi raised billions of dollars abroad through fraudulent Letters of Understanding and Foreign Letters of Credit issued with the help of rogue employees at PNB.
The CBI claimed that in mid-February, Modi’s aides packed cartons of documents at one of his diamond firm’s offices in Mumbai and sent them to the law firm’s office nearby, where police seized them days later. It also noted that the law firm wasn’t representing Nirav Modi or his companies, the media agency added.
Investigators had earlier arrested a couple of bank employees, including retired official Gokulnath Shetty, who was allegedly instrumental in issuing fake credit guarantees that bypassed the internal banking system.
Shetty escaped detection because he did not log his SWIFT transactions on the bank’s internal software – something he was supposed to do because the two systems were not integrated.
An internal investigation by PNB revealed that the practice of illegally extending credit in favor of firms owned Modi and Choksi started in 2011 and continued till it was discovered in January this year.
Modi has been hunted by Indian authorities since he fled abroad. His Indian passport was canceled in February but he is still on the run.