Fugitive businessman Mehul Choksi was traced and arrested in Dominica on Wednesday and may be brought back to India soon, much to the delight of the CBI and ED. Here are all the details of the CBI and ED cases filed against Choksi.
Mehul Choksi, a diamond trader by profession, is the prime accused in the Rs 13,500-crore Punjab National Bank fraud case. He fled from India in the first week of January 2018 and has been absconding since then. However, on Wednesday, he was traced and arrested in the island country of Dominica.
For the first time in three years, the Central Bureau of Investigation, Enforcement Directorate, and other Indian authorities may be able to get a hold of him as news of his possible deportation from Dominica comes in.
But what are the details of the cases filed against Choksi by these central agencies?
Central Bureau of Investigation:
On January 31, 2018, the CBI filed a first information report (FIR) on the complaint of Punjab National Bank that they had been defrauded of Rs 280 crore.
Before the CBI even initiated its investigation, Punjab National Bank (PNB) submitted another letter alleging that the total amount defrauded had increased to more than Rs 13,500 crore. Mehul Choksi and his nephew Nirav Modi were named the prime accused.
According to the CBI’s FIR, Choksi got letters of undertaking (LoUs) issued fraudulently with the help of PNB employee Gokulnath Shetty.
“During the investigation, it was found that very systematically and in an organized way, Mehul Choksi and Nirav Modi, in collaboration with some bank employees, were misusing the loopholes in the banking system. No ordinary mind can think of something like this,” said an officer.
The CBI named Mehul Choksi and his firms, including Gitanjali Gems, as prime accused in the case.
When the CBI started looking for Mehul Choksi and Nirav Modi, the central agency found that both had fled from India in the first week of January 2018.
Based on CBI’s FIR, the Enforcement Directorate also filed a case against Choksi, his companies, and associates under the Prevention of Money Laundering Act.
Choksi was summoned by both the CBI and ED to join the investigation. However, he did not appear before the investigators and in March 2018, a non-bailable warrant was issued against him by a Mumbai court.
On July 10, 2018, the Enforcement Directorate filed an application to declare Mehul Choksi a fugitive under the newly introduced Fugitive Economic Offenders Ordinance. Under this ordinance, the properties of the accused can be confiscated.
Mehul Choksi opposed this application by the ED. He claimed that he was outside India for business purposes and was willing to cooperate with the investigation.
In a letter, Choksi also said that his medical condition was not good. He stated he was suffering from blocked arteries, diabetes, and multiple other health issues.
The ED has attached multiple properties belonging to Mehul Choksi and Nirav Modi. These are worth over Rs 2,500 crore.
Charge sheets and investigation:
The CBI filed its first charge sheet in the case in May 2018, after arresting employees of Punjab National Bank as well as associates of Mehul Choksi and Nirav Modi.
In the same month, Choksi moved his base from the US to Antigua and Barbuda. He got citizenship of Antigua and Barbuda in November 2017 under the Citizenship by Investment program.
“It is alleged that the LoUs were unauthorisedly issued by the accused bank officials in conspiracy with Nirav Modi, Nishal Modi, Mehul Chinubhai Choksi and others without having any sanctioned limit and without obtaining 100 percent cash margin which is required if there is no sanctioned limit,” read the charge sheet filed by the CBI.
The central agency alleged that over 150 LoUs were issued fraudulently by the PNB. For this, bank employees including Gokulnath Shetty were bribed. The CBI found that over Rs 6,400 crore was defrauded by firms linked to Nirav Modi and around Rs 6,800 was defrauded by firms linked to Mehul Choksi.
The agency also found that in 2016, Choksi’s Gitanjali Gems took a loan of Rs 5,208 crore from a consortium of 34 banks led by ICICI Bank. Gili and Nakshatra, sister firms of Gitanjali Gems, had defaulted on Rs 1,447 crore and Rs 1,109 crore respectively of various banks.
In the meantime, a red notice was issued against Choksi by the international organization Interpol. Accordingly, extradition proceedings were initiated against him in Antigua and Barbuda.
As of now, Choksi’s case is still before the court with supplementary charge sheets filed against him by both the ED and the CBI.
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