Nirav Modi is not the only diamantaire to have run into trouble. There are others too.
GN Bureau | February 19, 2018
The dazzling diamond trade has been hit hard by the Nirav Modi episode, which saw the billionaire jeweller flee India just before a massive fraud amounting to Rs 11,000 crore was detected at a Punjab National Bank branch in Mumbai.
But, Nirav Modi is not the only diamond tycoon who has been found to be in the wrong side of the law. There are others too.
Jatin Mehta: Winsome diamonds and jewellery limited, promoted by Jatin Mehta, has a total debt of Rs 6,800 crore.
In 2016, the Enforcement Directorate attached assets worth Rs 172 crore of the diamond firm in connection with its money laundering probe in the major bank default case under the provisions of the Prevention of Money Laundering Act (PMLA).
As per data, of the total Rs 6,800 crore of debt and loans, Winsome owes Rs 4,680 crore to a consortium of lenders headed by Standard Chartered Bank. Its associate firm Forever Precious Diamonds and Jewellery owes another Rs 2,121.82 crore to a set of banks led by PNB, reported Economic Times.
Mehul Choksi: While the focus is now on Nirav Modi, his uncle, Mehul Choksi was taken to court by a group of seven engineering graduates from Rajasthan Institute of Engineering and Technology (RIET) last year.
The BTech graduates had collected Rs 3 crore through crowdfunding, mortgage and aid from their parents to open Gitanjali Jewellery Retail's franchise in Delhi's Rajouri Garden in October 2013. They realised that 'third-grade' damaged and old diamonds and gems were sent to them against a security deposit of Rs 1.5 crore, reported Times of India.
The engineers moved court which ordered Choksi's arrest if allegations were found true. Choksi moved the Delhi high court in August 2017 seeking quashing of the FIR.
Mihir Mehta: He is heir to a failed Belgium-based diamond trading business and has lost his bid in London’s High Court to unfreeze his assets.
The London High Court has upheld the injunction granted to ICICI Bank UK.
The arabianpost.com reported that the well-known Mehta family of Belgium lost their bid in London’s High Court to unfreeze certain of their family members’ assets, as they continue to be pursued by ICICI Bank UK for an $8 million debt following the default on a loan made to their family’s company Jayam NV. A prominent diamond trading company and former sight holder with De Beers, Jayam NV began experiencing financial difficulties and in June 2016 went into voluntary liquidation. Mihir Mehta was also convicted in Belgium of fraud-related offences.
Indian diamond traders in Antwerp: An investigation was opened in 2011 against 170 diamond traders in Antwerp for stashing away money in Geneva.
Mining.com said De Tijd published some of the names from a list of 170 of Antwerp diamond traders who it claims are being investigated by authorities for spiriting almost $1 billion (€700 million) in unpaid taxes into secret Geneva bank accounts.
The Antwerp traders are among a much larger roster of at least 24,000 HSBC Private Bank clients from Canada, India and Germany under investigation by French authorities since 2009.
According to IDEX Online France apparently informed Indian, Belgian, German and Canadian tax authorities about their listed citizens. Leaks from the ensuing investigation claim that some 700 Indian citizens – some of them leading diamond traders – are among those who held accounts at the Geneva branch.
Bharat Shah: On September 30, 2003, a special court found film financier and diamond king, Bharat Shah, guilty of having facilitated the crime of targeting film personalities for extortion, his co-accused, film producer Nasim Rizvi, and the latter's assistant, Abdul Rahim Allahbaksh Khan, were convicted of having conspired to commit the crime, reported The Hindu.
Preity Zinta, who was the star of Rizvi's film, 'Chori Chori Chupke Chupke' had told the court about the threats and extortion demands she had received from the underworld. Rizvi was arrested in December 2000 and Bharat Shah in January 2001. Bharat Shah's bail plea was rejected by the lower court seven times and the Mumbai High Court once. Finally, he got the bail from the Supreme Court after 15 months.
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