How Nirav Modi scripted largest bank scam, became India’s most wanted

Financial Express
March 10, 2019
       The fall of Nirav Modi is among the most dramatic ones in the history of India business. Once a globally celebrated Indian jewelry magnate rubbing shoulders with the likes of Britain’s Prince Charles and Hollywood and Bollywood A-listers such as Rosie Huntington-Whiteley, Taraji P Henson, Karlie Kloss, Priyanka Chopra, and Kareena Kapoor sporting his designs, Nirav Modi’s fortune took a nosedive when he got himself embroiled in one of the largest bank frauds in the history of India. His illegal dealings with the foreign branches of India’s commercial banks began in 2011, but was unearthed in January last year, making Modi the destroyer of his own destiny.
Now a fugitive diamantaire Modi, who was spotted in London’s West End by UK-based newspaper The Telegraph, is accused of siphoning off Rs 13,500 crore from Punjab National Bank (PNB), India’s second largest public sector lender.
Modi has been charged with allegations that companies linked to him and his relatives got credit worth Rs 13,500 between 2011 and 2017 using false Letters of Understandings (LoU) allegedly issued by the bank’s officials at its Brady Road branch in Mumbai.
Following the FIR filed by PNB with CBI in the last week of January 2018, the Enforcement Directorate began investigation against Modi from mid February onward under the Prevention of Money Laundering Act, 2002.
PNB in a letter last February to other banks stated the modus operandi used to commit fraud said that through SWIFT network, the bank official issued LoUs on behalf of companies linked to Nirav Modi Group including Solar Exports, Stellar Diamonds and Diamond R US to avail buyers credit from overseas branches of Indian banks. The bank said that the transactions weren’t routed through the core banking system to avoid fraud detection.
On Saturday, The Telegraph said that it has tracked down Modi to three-bedroom £8 million flat occupying half of a floor of the landmark Centre Point tower block in London’s West End, with views across the city. The newspaper added that Modi is now “involved in a new diamond business run from an office in Soho” that was incorporated in May 2018.
UK Home Secretary Sajid Javid, on Saturday, certified India’s request for Modi’s extradition, PTI cited officials involved with the case in the UK. The request is currently with the District Judge at the Westminster Magistrates’ Court in London.
The Indian authorities have been aware of the proceedings on Thursday even as officials in the UK have hinted that a possible arrest of Modi may be a matter of weeks. Modi along with uncle, Mehul Choksi, have been the main accused in the scam even as they left India before the fraud details came out in January 2018.
On Friday, Modi’s seaside bungalow in Alibaug was demolished using explosives. In October last year, the ED had seized and attached assets of Modi in India and outside worth Rs 637 crore that included jewelry, a flat in South Mumbai, bank accounts, and properties in countries such as the US and the UK.

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