Nirav Modi’s Firestar Diamond Inc Files for Bankruptcy in US
Meanwhile, PNB has upped estimate in the alleged fraud by $204 million, to $2 billion.
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Firestar Diamond Inc, one of the many companies owned by absconding diamantaire Nirav Modi, has filed for bankruptcy in the US, reported Bloomberg.
The company has reportedly listed upto $100 million in assets and debt, blaming liquidity and supply chain challenges for the bankruptcy.
Meanwhile, PNB has upped the estimate in the alleged fraud perpetrated by jewellers Nirav Modi and Mehul Choksi by $204 million, to $2 billion.
In a filing to stock exchange late on Monday night, the state-owned lender said that "the quantum of reported unauthorised transactions can increase by USD 204.25 million." The bank had earlier put the defrauded amount at Rs 11,394.02 crore (USD 1.77 billion). Adding another Rs 1,323 crore would take this to Rs 12,717 crore.
PNB said it has not received any instruction from the government to compensate other lenders for losses arising out of the fraud.
The jewellers and companies linked to them had allegedly colluded with PNB officers to obtain fake bank guarantees to get loan from overseas branches of Indian banks including Allahabad Bank, Axis Bank and UCO Bank.
The bank has enough capital/assets to pay for such liability in case of eventuality in accordance of law, PNB said in a separate statement to stock exchange made last night.
In filings earlier this month, PNB said it stumbled upon the scam on 25 January 2018, and a fraud report was filed with the Reserve Bank of India on 29 January. On that day, a criminal complaint for registration of FIR was also made with the CBI. Stock exchanges were informed of the fraud on 5 February.
(With inputs from PTI)