Where is Nirav Modi? New information comes to light in giant 'bank fraud': purported negotiations, bank lending figures, how the scam came to light, and more

New information has come to light in the purported $1.77 billion Nirav Modi bank fraud case. As per Republic TV sources, the jewellery billionaire has been untraceable for the last 19 hours and his office has no knowledge of his travels. Furthermore, while all major exit points of the country have been informed of the developments of the case, there is no clarity on whether he has already left the country.

Meanwhile, sources have also spoken of earlier negotiations between Nirav Modi's representatives and banks over a potential settlement in the case, with a figure of Rs. 5,500 crore (about half the suspected fraud amount) being mentioned. However, no formal solution was reached.

The Enforcement Directorate on Thursday raided over ten premises of Nirav Modi, including his residence in Mumbai, over the state-owned Punjab National Bank (PNB) flagging an estimated Rs 11,400 crore ($1.77 billion) scam involving the jewellery billionaire.

The fraud has to do with Nirav Modi allegedly acquiring fraudulent letters of undertaking from a branch in Mumbai to secure overseas credit from other Indian lenders. Both the ED and the CBI have registered cases in the matter. 

Here's how the scam came to light:

• On January 16, PNB noticed a set of fraufulent letters of undertaking (LoU) for and on behalf of Nirav Modi companies.
• This came to light when these firms approached the bank with certain import documents and sought buyers credit for making payment to overseas suppliers.
• Since there was no sanctioned limit mentioned, the bank asked them to furnish 100% cash margin.
• The Nirav Modi firms contested this saying they have been recieving the same in the past as well. However, the branch records didn't show any such detail.
• It then came to light that a Gokulnath Shetty who retired in May 2017 and was working in the import section of the Foreign Exchange Department from 2010 along with a Manoj Kharat issued LoUs without taking due documents and did not make entries in the banking system to avoid getting detected.

Apart from PNB, a number of other banks lent to Nirav Modi and companies:

• Union Bank: Rs. 2,300 crore
• Allahabad Bank: Rs 2,000 crore
• SBI: Rs 960 crore