The Finance Ministry said that the Punjab National Bank (PNB) had issued as many as 41,178 Letters of Undertaking (LoUs) since 2011, of which 1,590 were given to Nirav Modi, Mehul Choksi and their associates, reports from PTI.
Nirav Modi and his associates used fraudulent LoUs of the state-owned PNB to defraud the bank up to the tune of Rs 13,000 crore.
Once the scam came to light, the Reserve Bank of India has stopped the banks from issuing LoUs and the Letters of Comfort for trade finance.
In a written reply the Finance Minister Mr. Arun Jaitley, told the House on March 20, that PNB has apprised that 7,672 LoUs were issued with validity period of 90 days, 20,078 LoUs were issued with validity period of 180 days, 11,224 LoUs were issued with validity period of 365 days, and 2,204 LoUs were issued with validity period of more than 365 days.
"Further, PNB has informed that the details regarding money withdrawn from the foreign branch of the other banks against each LoU are presently not available as the matter is under investigation," said the reply made available on March 22, 2018.
Jaitley also said the Reserve Bank of India (RBI) has informed that it does not have "complete/granular" details of LoUs issued by PNB since 2011 till May 2014 and thereafter.
In reply to another question, Minister of State for Finance Shiv Pratap Shukla said that as per PNB, the total number of LoUs issued to the companies of Nirav Modi, his relatives, and the Nirav Modi Group is 1,213, and to Mehul Choksi, his relatives and the Gitanjali Group are 377.
He further said that "as per PNB inputs", the amount of repayment made by the companies against each LoU cannot be currently ascertained as the matter is under investigation.
Shukla added that PNB has apprised that payment of LoU is a contingent liability and may fall back upon the bank on due date only if the same is not paid on or before the due date by the buyer.