The CA Institute’s High Power Group to study the systemic issues in the Nirav Modi fraud on PNB is “waiting” for required documents /information from the scam-hit bank.

“It is worthwhile to note that the Group recommendations are dependent on availability of documents/information,” said a statement issued here on Friday.

This is significant as it is almost a month since this Group was constituted ( on February 16).

This Group has written to various officials of the bank, including the Chairman of the Audit Committee and a member, to provide relevant information in the matter so as to help understand the systemic issues.

Concurrent audit

The CA Institute said on Friday that ordinarily concurrent audit in a bank is carried out by an independent firm of chartered accountants.

As per the current system of appointment of auditors in PNB, both internal and concurrent audit was carried out by the PNB officials.

“Though a number of government agencies are trying to identify the culprit, yet it seems that prima facie the fraud has been done by collusion of many persons, inside and outside the system”, the ICAI statement added. The RBI in November 2016, in order to strengthen the banking system, instructed all the banks to link their SWIFT system with CBS.

But due to the non-linkage of the two systems, PNB fraud remained undetected. Letters of undertakings (LoUs) and unauthorised LCs beyond sanctioned limit remained outside the books and CBS of PNB and, therefore, could not be detected by many supervisory layers.

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