The Enforcement Directorate has found diamond merchant Nirav Modi, accused of perpetrating a Rs 13,000-crore fraud on Punjab National Bank, laundered around Rs 6,000 crore in 2017 during its probe into the case involving the public sector lender.
The government agency that fights financial crime has drawn up its first consolidated report based on the probe and arrests so far after conducting more than 250 raids in connection with the case.
“₹ 5,921 crore were laundered using 17 shell companies in 2017. All these shell companies are based abroad,” an official in the know of the matter said.
He refused to be named as the case is still under probe.
“ED is gearing up to file its first charge sheet in the matter. It will be filed within the next 60 days,” the source quoted above said.
The directorate in its report said that while Modi and his maternal uncle Mehul Choksi were the masterminds, they were helped by Karthik Doshi and Shyam Sundar Wadhwa in perpetrating the fraud and laundering the money.
Wadhwa, vice-president of Firestar Group, has already been arrested by ED. He helped Modi in creating two Hong Kong-based shell companies, Sino Trader and Aura Gems. Doshi is a shareholder Sino Trader and assisted Wadhwa in creating the dummy companies.
The Punjab National Bank has accused Modi and Choksi of committing a fraud of around Rs 13,000 crore in the issuance of letters of undertaking and foreign letters of credit from Mumbai’s Brady House branch between 2011 and 2017.
Modi used three companies Diamond R US, Stellar Diamond and Solar Exports to obtain Rs 6,498 crore through 150 fraudulent LoUs between February 2017 to May 2017. The money was withdrawn from the overseas branches of Indian banks, the ED said.
Officials of these banks, including state-owned banks and Axis Bank. have been questioned by the Central Bureau of Investigation.
During the same period, Rs 468 crore was transferred to Axis Bank in India by one of Modi’s shell companies, Aura Gems.
The Enforcement Directorate initiated its money laundering probe in the matter by registering separate Enforcement Case Information Reports following the registration of three first information reports by the Central Bureau of Investigation (CBI) in connection with the fraud.
The agency so far has conducted more than 250 searches across the country in the case and attached diamond, gold, precious and semi-precious stones and other movable and immovable assets worth Rs 7,664 crore so far.
Modi, Choksi and their family members left India in the first week of January and have not come back despite repeated summons from the CBI and ED.
ED has approached the Interpol for a Red Notice against Modi and Choksi.