The CBI on Monday questioned Ravi Shankar Gupta, the chief financial officer of Modi's company Firestar Diamonds International Limited in Mumbai, who is accused in the agency FIR in connection with the case, an official said.
The agency is grilling him to know how the loans were granted and how the diversion of funds happened besides the involvement of senior executives of the PSU banks.
The loans were given by two consortium of banks to the companies of Nirav Modi --Firestar International Pvt Ltd where Punjab National Bank is the lead bank and Firestar Diamonds International Pvt Ltd where Union Bank of India is the lead bank.
"There is a difference between the earlier case against Nirav Modi in which Letters of Undertaking were issued in fraudulent manner and this case where credit limits were sanctioned. In the case of LoUs, one can assume that it was handiwork of lower rung of employees but credit facilities are monitored by various senior-level officials," the official said.
The agency would call for questioning senior officials of the lending public sector banks to understand how monitoring was being done and what steps were taken to prevent the diversion of funds, the official said.
The CBI has named Nirav Modi, then president (finance) of his company Firestar Diamonds International Limited Vipul Ambani, Ravi Gupta, other directors and officials of the company, and unidentified public servants of the bank, they said.
In its complaint, now part of the FIR, the bank alleged that it came to its notice that credit facilities were not used for the purpose -- packing credit, guarantees etc -- for which they were given.
The head office of bank had declared the accounts of Firestar Diamonds and Firestar International as fraud and reported it to the Reserve Bank of India on March 4, it said.
The bank alleged that during its internal investigation, it spotted "circular transactions" between Modi promoted partnership firms -- Solar Exports, Stellar diamonds and Diamond R Us -- and Firestar group of companies, also promoted by him.
The bank said a criminal conspiracy was hatched by the accused causing a loss of Rs 321.88 crore which remained outstanding to the public sector bank.
Nirav Modi is already facing an FIR pertaining to over Rs 6,200 crore of alleged fraudulent letters of undertaking (LoUs) and letters of credit (LCs) issued to his company by the PNB.
The diamond merchant and his uncle Mehul Choski, promoter of Gitanjali group, are accused in the issuance of LoUs and LCs worth USD 2 billion (approximately Rs 12,636 crore).