BANKING FRAUD

India asks Hong Kong to arrest jeweller Nirav Modi in PNB fraud case

Modi is the main suspect in the Rs 12,000 crore Punjab National Bank scam case

PNB scam The PNB scam, the biggest swindling in India’s banking history, was going on smoothly for the last seven years | Salil Bera

The Centre has asked authorities in Hong Kong to arrest jeweller Nirav Modi, one of the main suspects in a $2-billion fraud at state-run Punjab National Bank, the government said, suggesting it believes the fugitive is in the Chinese territory. 

The whereabouts of Modi and his uncle Mehul Choksi, the other person accused in India’s biggest banking fraud at the country’s second-largest state lender, have been unknown since the Central Bureau of Investigation (CBI) launched an investigation in February.

“The ministry has sought the provisional arrest of Nirav Deepak Modi by the government of the Hong Kong Special Administrative Region, People’s Republic of China,” junior foreign minister V.K. Singh told parliament on Thursday.

The passports of Modi and Choksi, who both left India before the scandal emerged, have been revoked. Singh said India had submitted the request for Modi’s arrest to Hong Kong on March 23. 

Modi and Choksi had fled the country after the alleged bank fraud came to light.

The MEA had served show cause notices to Modi and Choksi on February 16, giving them a week to respond. "Since they failed to respond within the stipulated time period, their passports were revoked," he said.

Modi, who owned a chain of boutiques from New York to Hong Kong, and Choksi are accused of defrauding banks by raising loans from overseas branches of Indian lenders using nearly Rs 12,000 crore of fraudulent guarantees issued by rogue Punjab National Bank staff at a Mumbai branch.

Modi and Choksi have both denied wrongdoing.