Indian auditor group begins probe into PNB fraud case

The state-controlled regulator for accountants is probing whether auditors played a role in perpetrating the alleged $1.77 billion fraud that Punjab National Bank unearthed last week. (Reuters)
Updated 23 February 2018
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Indian auditor group begins probe into PNB fraud case

NEW DELHI/MUMBAI: The Institute of Chartered Accountants of India (ICAI), a state-controlled regulator for the sector, has said it is probing whether auditors played a role in perpetrating the alleged $1.77 billion fraud that Punjab National Bank unearthed last week.
The ICAI said on Thursday it has asked the Securities and Exchange Board of India, Punjab National Bank (PNB) and federal investigating agencies to share their findings about the alleged fraud, including anything related to the involvement of any chartered accountants.
The ICAI, which functions under the administrative control of India’s Ministry of Corporate Affairs, said it has set up a committee to study the systemic lapses that contributed to the fraud and to suggest remedial measures and improvement.
Separately, the Economic Times newspaper reported that PNB has tapped PwC to conduct a probe into the alleged fraud that would help the bank build a case against jewelers Nirav Modi and Mehul Choksi.
PNB officials were not immediately reachable for comment, while PwC declined to comment on the matter.
Modi, his companies, and firms with links to his uncle Choksi, are at the center of the alleged fraud that involved illegally issued letters of undertaking from PNB which were used to get credit from overseas branches of other, mostly Indian banks.
In what has been dubbed the biggest loan fraud in India’s banking history, police have so far arrested at least a dozen people — six from the bank and six more from Modi’s and Choksi’s companies.
A lawyer for Modi has denied his client was involved in any fraud. Choksi has not commented but his firm, Gitanjali Gems , has also denied involvement in the alleged fraud.


Volvo quits Iran as US sanctions pressure mounts

Updated 25 September 2018
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Volvo quits Iran as US sanctions pressure mounts

  • Volvo cannot get paid in Iran due to US sanctions
  • Plans were for at least 5,000 trucks to be assembled in Iran Saipa Diesel says zero Volvo trucks assembled since May

STOCKHOLM, Sweden: Swedish truck maker AB Volvo has stopped assembling trucks in Iran because US sanctions are preventing it from being paid, a spokesman for the company said on Monday.
The sanctions against Iran, reimposed on Aug. 6 by US President Donald Trump after his decision to pull out of a nuclear deal with Tehran, have forced companies across Europe to reconsider their investments there.
Volvo spokesman Fredrik Ivarsson said the trucks group could no longer get paid for any parts it shipped and had therefore decided not to operate in Iran in another blow to the country’s car industry, which unlike the energy and banking sectors, had managed to sign contracts with top European firms.
“With all these sanctions and everything that the United States put (in place) ... the bank system doesn’t work in Iran. We can’t get paid ... So for now we don’t have any business (in Iran),” Ivarsson told Reuters by telephone.
Before the sanctions were reimposed, Volvo had expressed an ambition for Iran to become its main export hub for the Gulf region and North Africa markets.
The European Union has implemented a law to shield its companies, but the sanctions have deterred banks from doing business with Iranian firms as Washington can cut any that facilitate such transactions off from the US financial system.
Volvo was working with Saipa Diesel, part of Iran’s second-largest automaker SAIPA, which was assembling the Swedish firm’s heavy-duty trucks from kits shipped to Iran.
Ivarsson said Volvo had no active orders in Iran as of Monday.
A commercial department manager at Saipa Diesel confirmed that sanctions had prompted Volvo Trucks to terminate their partnership agreement.
“They have decided that due to the sanction on Iran, from (May) they couldn’t cooperate with us. We had some renovation planned in Iran for a new plant but they refused to work with us,” said the manager, who declined to be identified.
More than 3,500 Volvo trucks had been assembled by Saipa Diesel in the year to May, but none had been assembled in this financial year although the original deal was for at least 5,000 trucks, the manager told Reuters.
Swedish truckmaker Scania, which is owned by Volkswagen , said it had canceled all orders that it could not deliver by mid-August due to sanctions, while French carmaker PSA Group began to suspend its joint venture activities in Iran in June.
Germany’s Daimler has said it is closely monitoring any further developments, while carmaker Volkswagen has rejected a report that suggested it had decided against doing business in Iran.