Govt tells PSBs to integrate banking systems, rotate staff as a policy

PNB's former deputy branch manager, Gokulnath Shetty, now charged with having initiated the fraudulent transactions, was at its Brady House branch for over seven years

The department of financial services will soon hold a meeting with the information technology team of all public sector banks (PSBs) to ensure a scam such as the one at Punjab National Bank does not recur, officials said.

The department has directed all PSBs to plug the technology lapses that enabled the scam of fraudulent Letters of Undertaking (LoUs) issued on behalf of the Nirav Modi and Mehul Choksi groups of companies, to foreign branches of Indian banks.

"We have asked all banks to integrate their Core Banking System with the SWIFT [Society for Worldwide Inter-Bank Financial Telecommunication] system," said a senior