PNB official shared SWIFT password with Nirav’s firm

New Delhi, February 19

A former deputy manager of Punjab National Bank (PNB), arrested in the fraud case, has told investigators that he had illegally obtained level-5 password to the SWIFT system to authorise issuance of money through Letters of Undertaking (LoUs) and Foreign Letters of Credit (FLCs).

Gokulnath Shetty made the revelations when Central Bureau of Investigation (CBI) sleuths questioned him about the modus operandi of providing guarantee to other banks under the LoUs and issuance of enhanced FLCs.

He also told the investigators that he shared the password with other individuals, essentially employees, as well as directors of Nirav Modi’s company.

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The level-5 password was the key allowing him to reach out to several banks to release the money to Nirav Modi and Gitanjali groups through the SWIFT system, which, according to PNB amounted to a fraud of Rs 11,300 crore. SWIFT or Society for Worldwide Interbank Financial Telecommunication, headquartered in Belgium, provides a network to enable financial institutions to send and receive information about financial transactions in a secure and standardised manner.

An LoU is a guarantee by the bank that should the borrower default on repayment, it would pay back the money to the original lender. An FLC is a sort of guarantee to a third party or vendor that money for the goods supplied would be paid.

Meanwhile, the CBI on Monday continued examining several PNB officials, besides questioning four employees of diamond merchant Nirav’s firms, including Vipul Ambani and Ravi Gupta, both chief financial officers; Saurabh Sharma, president, finance division; and Subhash Parab, finance executive, in connection with the multi-crore bank fraud, an official said. — IANS