Punjab National Bank Scam: City Union Bank Loses Nearly $2 Million; Recovers Half Money

India.com News Desk
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Punjab National Bank Scam: City Union Bank Loses Nearly $2 Million; Recovers Half Money

Bank detected the transactions while reconciling accounts and about half the money has been retrieved.

New Delhi, Feb 19:  Days after Rs 11,400 crore fraud at Punjab National Bank (PNB) was surfaced, a private sector City Union bank has said that it had suffered three fraudulent remittances of USD 2 million (about Rs 12.8 crore) which has been pushed through the SWIFT financial platform.

However, there was no mention of remittances in the ledgers of the City Union Bank. City Union on Saturday said that the transfers had been made through correspondent banks even though the Indian lender had not requested the transfers. The Indian lender said it had been able to block a remittance of $500,000.

The second transfer of 300,000 euros ($372,150.00) was routed through a Standard Chartered Bank account in Frankfurt to a Turkish account, while a third totalling $1 million was sent through a Bank of America account in New York to a China-based bank. The bank said it was working with the Ministry of External Affairs and officials in Turkey and China to repatriate the funds.

Last week, PNB has said that it had been hit by a $1.77 billion fraud. Bank lodged an FIR with CBI stating that fraudulent LoUs worth Rs 280.7 crore was first issued on January 16. At the time, PNB had said it was digging into records to examine the magnitude of the fraud.

The share prices of PNB fall after the detection of fraudulent transactions in its Mumbai branch. In its regulatory filing, the PNB said it had detected “some fraudulent and unauthorised” transactions amounting to around Rs 11,360 crore (approximately).

 “The bank has detected some fraudulent and unauthorised transactions in one of its branch in Mumbai for the benefit of a few select account holders with their apparent connivance. Based on these transactions, other banks appear to have advanced money to these customers abroad,” said PNB to Bombay Stock Exchange (BSE).

While the PNB has informed law enforcement agencies about the fraudulent deals, it is yet to reveal the names of people involved in fraudulent transactions. At 9.43 am, the stock price of PNB was at Rs 155.15 a piece, down by 4.02 percent on the BSE. PNB is the third largest lender of the country.