February 20, 2018 / 11:05 AM / 8 months ago

Enforcement Directorate probing 100 shell companies for links to Indian bank fraud case

NEW DELHI (Reuters) - India’s financial crime fighting agency is investigating more than 100 “shell companies” that are suspected to be involved in the Punjab National Bank’s near $1.8 billion fraud, a government source said on Tuesday.

A man tries to remove a notice pasted on the wall of a Punjab National Bank branch after it was sealed by India's federal police in Mumbai, India, February 19, 2018. REUTERS/Francis Mascarenhas

The companies were allegedly used by Indian jewellers Nirav Modi and Gitanjali Gems’ Mehul Choksi to route funds, a source at India’s Enforcement Directorate told Reuters.

Modi and Choksi are at the centre of the biggest ever bank fraud that has hit the country’s second largest lender Punjab National Bank. Both the businessmen have been accused of conspiring with bank officials to obtain advances for paying overseas suppliers.

A lawyer for Modi has denied any wrongdoing. Choksi’s firm has also said it has nothing to do with the fraud case.

Reporting by Aditya Kalra; Editing by Sanjeev Miglani

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