Days after the Rs 11,400 crore fraud
at PNB shook
the country, private sector City Union Bank today
said it suffered three fraudulent remittances of nearly USD 2 million (about Rs
12.8 crore).
Just like the
fraud at Punjab National Bank (PNB), no entries of remittances were made in the
ledgers of City Union Bank and transfers were pushed through the SWIFT
financial platform.
"During our
reconciliation process on February 7, it was found out that 3 fraudulent
remittances had gone through our SWIFT system to our corespondent banks which
were not initiated from our bank's end. We immediately alerted the
correspondent banks to recall the funds," City Union Bank said in a
regulatory filing on stock exchanges.
Of the 3
fraudulent remittance, one remittance was made through Standard Chartered Bank,
New York, to a Dubai based bank for USD 5,00,000 which was blocked immediately
and was returned to City Union Bank, it said.
Chennai-based City
Union Bank said the transfers had been made through correspondent banks even
though it had not requested the transfers.
A second transfer of
300,000 euros (USD 372,150) was routed through a Standard Chartered Bank
account in Frankfurt to a Turkish account, while a third totalling USD 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.
"With the help of
Ministry of External Affairs through Consulate General of Shanghai and Istanbul
and office of the National Cyber Security Council (PMO) all possible efforts
through diplomatic and legal channels are being taken to repatriate the
money," it said.
The recent episode raises
question mark on the efficiency of the SWIFT network as how secure it is.
The PNB fraud pertains
to issuance of fake Letters of Understanding (LoUs) to companies associated
with billionaire jeweller Nirav Modi by errant PNB employees which enabled these
companies to raise buyers credit from international branches of other Indian
lenders.
Last week, PNB had
lodged an FIR with CBI stating that fraudulent LoUs worth Rs 280.7 crore were
first issued on January 16. At the time, PNB had said it was digging into
records to examine the magnitude of the fraud.
In the complaint, PNB had named three diamond
firms -- Diamonds R Us, Solar Exports and Stellar Diamonds -- saying they had
approached it on January 16 with a request for buyers credit for making payment
to overseas suppliers. The bank sought 100 per cent cash margins for issuing
LoUs for raising buyers credit, which was contested by the firms saying they
had availed of the facility from as early as 2010.
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