The country’s financial crime agency, the enforcement directorate, said it had searched dozens of locations linked to Nirav Modi, the diamond billionaire at the centre of the investigation, over the last 48 hours, seizing diamonds, gold and jewellery worth Rs56.49bn ($880mn).
Raids were also carried out yesterday by the Central Bureau of Investigation (CBI) on the offices of jewellery retailer Gitanjali, whose chief executive has been accused along with Modi of colluding with PNB employees to fraudulently obtain advances for payments to overseas suppliers.
The Gitanjali group of firms is led by Modi’s uncle, Mehul Choksi. PNB has said companies tied to both retailers, whose outlets stretch from New York to London to Beijing, were the recipients of loans from several other banks based on guarantees provided by it. Earlier PNB’s chief executive Sunil Mehta, speaking on an investor conference call, said the bank was co-operating with the investigative agencies.
India’s second-largest state-run lender was also running an audit of its systems to prevent a recurrence of such a fraud, but did not see a long-term
hit to its operations, he said.
“The amount is big. But we will have the capacities to bring it back to normalcy, maybe within six months,” Mehta said.
But he ended the call abruptly after less than 15 minutes when he was made aware of the presence of a number of journalists on the line. Before hanging up, Mehta was heard admonishing his staff for allowing the media to listen in to the call, the schedule of which had been published in a stock exchange filing.
Separately, a bank source said the lender was considering raising cash by selling some of its properties, including a giant office space in New Delhi, worth an estimated Rs50bn ($778.6mn).
A police source said the CBI, in a new case, has accused the Gitanjali group of defrauding PNB of $763mn. The foreign ministry said it had suspended the passports of Modi and Choksi for four weeks, and had given them one week to voice objections to its plan to revoke the documents. Neither has been charged with any offence.
The NDTV new channel reported Modi, whose high-end jewellery has been worn by Hollywood stars including Kate Winslet and Rosie Huntington-Whiteley, was at a suite in a hotel in New York, citing household staff who answered the door.
Video of PM hosting fugitive jeweller surfaces
In the midst of a raging controversy over the Rs115bn banking scam, a video has surfaced of Prime Minister Narendra Modi hosting fugitive Gujarati jeweller Mehul Choksi at his official residence in 2015. The video clip put out by online newsportal GoNews shows Choksi, chairman and MD, Gitanjali Group, seated among the audience at the prime minister’s 7, RCR residence, now called 7 Lok Kalyan Marg. The event, which took place on November 5, 2015, was to unveil three schemes aimed at dampening physical demand for gold in the country and tap into an estimated 20,000 tonnes of the yellow metal lying idle with households and institutions in India.
