Published: Tue, May 15, 2018
Finance | By Loren Pratt

CBI names ex-PNB CEO Usha Ananthasubramanian in PNB scam case

CBI names ex-PNB CEO Usha Ananthasubramanian in PNB scam case

The PNB board has Monday divested its two executive directors, KV Brahmaji Rao and Sanjiv Sharan, of all financial and executive powers.

Between January and March, the CBI had filed three FIRs in the case- against Nirav Modi, Mehul Choksi and third against Modi's Firestar Diamonds. Meanwhile, Allahabad Bank, in a stock market filing, announced that its board will meet on Tuesday to discuss the issue of CBI allegedly charging its CEO Usha Ananthasubramaninan in the PNB fraud. Filed in a special Mumbai court, the chargesheet also names several other top officials of the bank. He also informed that the board meeting of PNB was on and the ministry was waiting for its resolution. HE said, "We have directed directors of PNB and Allahabad bank to divest all the powers of those who are accused".

According to the CBI, Ananthasubramanian and other PNB officials overlooked warnings from RBI regarding compliance and even misrepresented the factual position to the banking regulator on SWIFT operations.All of them have been charged under Section 409 of the IPC for criminal breach of trust, Section 420 for cheating, and Section 13 (2) of the Prevention of Corruption Act.

The role of bank's former chief Usha Ananthasubramanian has been detailed in the chargesheet.

In the year-ago quarter ending March 2017, the second largest public sector bank had turned around due to write-back in pension provisions to report a profit of Rs 261.9 crore as against a massive loss of Rs 5,367.1 crore, the biggest loss among banks since the clean-up exercises started in 2015. The agency alleged that the proceeds of buyer's credit availed from overseas banks on the basis of LoUs of the PNB were dishonestly and fraudulently diverted to pay off the oustanding liabilities of the three accused firms, directly and indirectly controlled by Nirav Modi.

When asked about action against two MDs named in the FIR related to loans given to Aircel by IDBI Bank, he said, "I would like to make it clear that you can not take action only on hearsay".

Kumar said there is a set process for the removal and dismissal of directors from the board of a bank. So this is a clear message that we have to be responsible for what we do. "However, the said senior PNB officials, both serving and retired, failed to do so and therefore they are chargesheeted", said an official familiar to the probe. The CBI recently questioned Ananthasubramanian in connection with the scam. The stock exchanges had asked a query from the bank asking if its CEO was charged by CBI in the PNB fraud.

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