Mumbai: The Central Bureau of Investigation (CBI) deported Subhash Shankar Parab, a close acquaintance of fugitive jeweller Nirav Modi, from Egypt today, according to official sources.
Mr Parab, who escaped to Cairo in 2018, arrived in Mumbai early this morning after being deported, according to authorities, and will be brought before a CBI court at 12 p.m.
In the 7,000-crore Nirav Modi bank fraud case, he is the main suspect.
Officials said Mr. Parab, who was Firestar Diamond’s Deputy General Manager (Finance), might reveal details on the country’s largest financial scandal, allegedly perpetrated by Nirav Modi and Mehul Choksi at the state-run Punjab National Bank (PNB), which resulted in a loss of Rs 13,000 crore.
Mr Choksi took Antigua and Barbuda citizenship in 2017 using the Citizenship by Investment programme, even before fleeing India in the first week of January 2018. While Mr Modi is in a London prison after being denied bail on multiple occasions and is fighting extradition to India, Mr Choksi took the citizenship of Antigua and Barbuda in 2017.
Messages for fraudulent Letters of Undertaking (LoU) were transmitted to foreign banks by exploiting SWIFT, an international financial messaging system, and without making subsequent entries in PNB’s internal software ‘Finacle,’ circumventing any inspection of such money in the bank.
An LoU is a guarantee offered by an issuing bank to Indian banks with branches overseas in order to award the applicant a short-term credit. In the event of a default, the bank issuing the LoU is responsible for paying the debt to the credit-giving bank, plus interest.
Mr Modi and Mr Choksi’s enterprises acquired loans from foreign banks based on these LoUs but did not repay them, shifting the burden to PNB.
Senior PNB executives are accused of failing to follow the Reserve Bank of India’s (RBI) circulars and caution notes on the security of the SWIFT operation, and of lying to the apex bank about the situation.
Despite several RBI circulars, warning notices, and questionnaires, the CBI claims that the Core Banking Solutions (CBS) and SWIFT communications were not reconciled.