India's PNB says detects 38 billion rupee scams
People walk past Punjab National Bank's Brady House Department in Mumbai, India, June 14, 2018. REUTERS / Francis Mascarenhas
MUMBAI (Reuters) ̵[ads1]1; India's state-owned Punjab National Bank (PNB) on Saturday said it had reported a loan of 38.05 billion Indian Rupees ($ 556 million) in Bhushan Power & Steel Ltd's central bank account.
The fraud, which claimed the redirection of funds from the banking system, was reported to the Reserve Bank of India (RBI) on the basis of the findings of forensic audit and the federal police who sent a first information report, PNB said in a statement to the stock exchanges.
"It has been observed that the company has misappropriated bank funds, manipulated books with accounts to raise funds from consortium lender banks," said PNB, adding that it had already made reserves of 19.32 billion rupees on Bhushan's account.
PNB has been deceived over $ 2 billion in its own scam that came to light last year.
Bhushan Power and Steel, one of India's most reputable companies, was among the first 12 companies that RBI India referred to a bankruptcy law for a debt resolution process under India's new insolvency law.
The company could not be reached for comment on the PNB declaration.
Reporting of Sankalp Phartiyal; Editing by Stephen Powell
