Indian investigators arrest top auditor in bank fraud case

NEW DELHI, Feb. 28 (Xinhua) -- India's Central Bureau of Investigation (CBI) Wednesday arrested a top internal auditor of the state-owned Punjab National Bank in connection with the the country's biggest-ever bank fraud of 1.8 billion U.S. dollars.

"The bank's internal auditor M.K. Sharma has been taken into custody. He was responsible for auditing the systems and practices of Punjab National Bank's Brady House Branch, from where fraudulent Letters of Undertaking were issued to firms owned by billionaire jeweller Nirav Modi," a senior official said.

With this arrest, the number of those taken into custody by investigators has risen to 13, though they have not yet charged Modi for the crime.

Modi is at the centre of the bank fraud. And India's External Affairs Ministry has already revoked the passports of Modi and his uncle and business partner Mehul Choksi for their involvement in the scam.

Indian authorities have also launched a massive crackdown on companies linked to Modi, and seized 10,000 luxury watches and nine luxury cars last week, apart from freezing his personal shares and mutual funds.

Modi is said to have defrauded Punjab National Bank, India's second largest state-run bank, of 1.8 billion U.S. dollars, though he has said that he owed the bank only 775 million U.S. dollars, in a letter to the bank's management.

The celebrity jeweller -- the mastermind of the massive fraud -- is said to have fled the country and was reportedly last seen in New York after his appearance at World Economic Forum in Davos as a part of an Indian delegation. Enditem