PNB scam: Sebi begins probe

As the massive fraud over Rs 11,000 crore detected by Punjab National Bank (PNB) has shaken the financial institutions in the country, especially the banking system, markets regulator Securities and Exchange Board of India (Sebi) took the lead on Friday by launching a probe into trading and disclosure related issues in the matter of PNB and Gitanjali Gems in connection with multi-crore banking fraud allegedly perpetrated by absconding Nirav Modi.

“Sebi accords utmost importance to market conduct and integrity. Anyone found violating the securities laws will be dealt with firmly,” a regulatory official said. Incidentally, in July 2013, NSE in consultation with Sebi had debarred Gitanjali Gems chief and main promoter Mehul Choksi among others from trading, for securities market violations relating to trading in his company.

The Securities and Exchange Board of India (Sebi) and stock exchanges have begun analysing the stock market trade details of all entities associated with Modi including Choksi, who has already been under scanner for various cases including a brokerage default incident.

The regulator and the exchanges are also probing Choksi and his listed entity Gitanjali Gems for disclosure lapses, including for postponement of a board meeting earlier this week without disclosing sufficient reasons.

Choksi was not immediately available for comments and his phone was found to be switched off.