PNB scam: We won't tolerate public money loot, warns PM Modi

Prime Minister Narendra Modi warned on Friday that his government will take stringent action against financial irregularities and not tolerate loot of public money, in a strong and direct reference to the Rs 11,400-crore fraud at the Punjab National Bank (PNB).

Speaking at a Global Business Summit, Modi asked the management of financial institutions as well as the supervisory bodies to do their job diligently, days after the fraud, allegedly masterminded by diamantaire Nirav Modi at India's second-biggest public sector bank, came to light.

"I want to make it clear that this government has been taking strict action against financial irregularities and will continue to take strict action," he said, adding that the system will not tolerate loot of public money.

Nirav Modi and firms linked to him are alleged to have acquired fraudulent letters of undertaking (LoUs) from one PNB branch in Mumbai between 2011 and 2017 to obtain loans from Indian banks overseas.

The Prime Minister said the management of financial institutions, auditors and regulators should perform their duty with full dedication. "I want to make an appeal to those who have been entrusted with the job of framing rules and policies and maintaining ethics to do their job diligently and with dedication," he said.

(With PTI inputs)