A special court in Mumbai remanded former Punjab National Bank (PNB) official Gokulnath Shetty to Enforcement Directorate (ED) custody till April 11. He allegedly played a key role in the Rs 13,700-crore loan fraud while working as the deputy manager at PNB's Brady House branch.
Shetty was arrested on Thursday by the ED after the Prevention of Money Laundering Act (PMLA) court on April 3 approved the agency's plea for his custody in connection with the PNB fraud case. Absconding diamantaires Nirav Modi and his uncle Mehul Choksi have been named as the prime accused in this multi-crore bank fraud case.
"He was remanded to EDs custody till April 11," PTI quoted an ED official.
While seeking Shetty's custody, special prosecutor Hiten Venegoankar today told judge MS Azmi that Shetty apparently played a key role in the execution of the illegal transactions and was a key conspirator and actor in laundering of money. The complaint filed by PNB in this case claimed that Nirav Modi and Mehul Choksi had colluded with bank officials to get loans through fraudulent Letters of Undertaking (LoU).
As Modi and Choksi had left the country, "it is imperative for the ED to examine the accused in custody and confront him with the documents and statements of the other suspected persons," stated the ED application.
The Central Bureau of Investigation (CBI) had arrested Shetty, along with single window operator Manoj Kharat and Hemant Bhat, an authorised signatory of Nirav Modi Group, in February. The arrests were made based on the FIR filed by PNB with the central agency in January. He was later remanded in judicial custody.
According to the CBI, the firms owned by Modi and Choksi obtained the LoUs fraudulently in connivance with some PNB officials. These LoUs were used to obtain credit from overseas banks, resulting in a loss of over Rs 13,700 crore to PNB.