Diamond dealer wanted for huge bank scam 'seeking asylum in UK'

Controversial diamond jeweler Nirav Modi, who is accused of being a central figure in a US$2.2-billion fraud at India’s second largest state-run bank, is now seeking political asylum in the United Kingdom, the Financial Times has reported.

Punjab National Bank has alleged that two jewelry groups headed by Nirav Modi and his uncle Mehul Choksi defrauded it of about US$2.2 billion via transactions that date back to 2011.

Modi, 47, and Choksi have been on the run since the scam came to light. They have never admitted to guilt and Modi reportedly first flew to the UAE. Now, he is in the UK, allegedly claiming he is facing “political persecution”.

Officials at India’s Ministry of External Affairs (MEA) told the Financial Times that the government will push for him to be extradited after law enforcement agencies approach them.

In early April, the MEA informed the Upper House of the Parliament that Nirav Modi was in Hong Kong. The ministry submitted a request to Chinese authorities overseeing Hong Kong for the provisional arrest of the jeweler, who was classed as an absconder, to try to stop Modi from leaving Hong Kong before seeking to extradite him.

But by late April, reports emerged that Modi had left Hong Kong on February 14 for London and after spending a month there he left for New York in the United States. There was also speculation that he would have used his Belgium passport for all this travel as his Indian one had been canceled by the government.

The Central Bureau of Investigation (CBI) is probing the bank fraud case involving Modi and his uncle Mehul Choksi and filed a First Information Report (FIR) against them. The agency is apparently exploring all ways to get him back in India.

Modi is also accused of defrauding The Bank of India (BoI). It filed a lawsuit against Nirav Modi and four of his companies in a Hong Kong court on April 7 in order to recover money he received on the basis of illegally-secured letters of undertaking.

The Punjab National Bank accused Modi of raising credit from overseas branches of other Indian banks using illegal guarantees issued to him by bank staff at a branch in Mumbai over several years.

Bank staff fraudulently issued letters of undertaking (LoUs), without authorization, on behalf of some companies belonging to Nirav Modi Group. None of the transactions were routed through the centralized banking system, PNB officials allege.

Asia Times

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