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Nirav Modi – “Who is he ?”
Greed has always been the reason for the downfall of several men & women. 1 such man was born on 27th, February 1971 in Palanpur, Gujarat, in a family, which was in the diamond business. Soon after his birth, he went to Belgium & returned to India with his father when he was 19 to join his uncle, Mehul Choksi’s business. The name itself became an overseas brand in the field of diamond jewelry – Nirav Modi. Nirav Modi is a luxury diamond jeweler & designer who owns 5 stars international. The parent company of Nirav Modi chain of diamond jewelry retail stores. He was the 1st man to get featured on the cover page of magazines like Sotheby’s & Christie’s in 2010. Later in the same year, he sold his collections. Golconda Lotus necklace for 16.29 crores at Christie’s auction.
The necklace is a 12-carat pear-shaped diamond as a centerpiece. In 2013, Nirav was also featured in the Forbes list of Indian billionaires. At 1 time, there were 16 different stores at key locations around the globe. Such as Hong Kong, New York, London, Macao, Singapore Delhi & Mumbai. Nirav’s ambition was to create 100 such stores globally. But at what cost ?. His overambitious attitude led to a scam that was around 11,400 crores. Some call it a PNB scam. Some say it’s a Nirav Modi scam. This blog is about 1 of the biggest scams that happened in India.
Nirav Modi – “How the great scam started ?”
It’s 1 of the largest banking scams of India that shocked the whole nation. It also affected the image of the country globally, due to corruption in the banking system. So what exactly was the scam ?. To understand the scam better. First, we need to know what an LOU & Swift Code is. LOU is a letter of undertaking provided by a bank, which 1 can use to get a loan from a branch of the bank, abroad. So basically LOU serves the purpose of guarantee. A Swift system means a network used to send & receive information such as transactions, instructions globally by financial institutions. Such as banks in a safe & secured manner. What Nirav Modi did was he bribed officials at PNB’s Brady House branch in Mumbai. He to release LOU for him without keeping any collateral.
The scam came into the limelight
The 1st fraudulent guarantee he got from PNB was on 10th, March 2010. He managed to get more such LOU from the same single branch. PNB employees at Brady House involved in this case handed out LOU via Swift system to overseas branches without entering the transactions in their bank hence keeping the bank in dark for years. The whole case unfolded when overseas branches presented import documents to PNB’s Mumbai branch, & ask the credit to pay overseas lenders. Indian brands didn’t have any prearranged funds with them.
On 29th, January 2018, PNB lodged an FIR with CBI against three companies & 4 individuals which included Nirav Modi & his uncle Mehul Choksi stating that they had cheated the bank. Later, it was found that there were 2 main accused in this case & both from the Brady House branch. 1 was Gokulnath Shetty, the then deputy manager & Manoj Kharat, who was a clerk in the same branch.
Waiting for the extradition
Nirav Modi as soon as he heard the news from internal sources fled to the UK on 1st January 2018, before even the FIR was launched. His uncle Mehul followed him & fled on 4th January. Later, Nirav Modi was found & arrested. His bail is rejected by the UK court & Nirav remained to be in prison, fighting his extradition case to India till 25th February 2021. On 25th, 2 years after Nirav Modi’s arrest UK court cleared the way for Nirav’s extradition to India & he will be brought back to India very soon where his trials shall continue.
Gokulnath Shetty was arrested & remains in custody, denied all wrongdoing. Manoj Kharat is awaiting his trials. Around 9 to 10 employees of Nirav Modi Company & 8 to 10 employees of BNB have been charged in the fraud case. It would be interesting to learn what India will do to Nirav Modi as soon as he’s extradited to the country.
