INVESTIGATORS in India today (15) raided the premises of a billionaire jeweller accused of defrauding one of the country’s biggest banks amid reports he and his family have left the country.
Enforcement Directorate (ED) officers searched the Mumbai offices of Nirav Modi after he was accused of cheating state-owned Punjab National Bank (PNB) of Rs 2.8 billion ($43.8 million).
Footage broadcast on Indian television news channels showed officers entering one of Modi’s jewellery showrooms in Mumbai.
Investigators searched four locations in Mumbai, including Modi’s home, as well as stores in New Delhi and Surat, India’s diamond trading hub, according to an ED directive being shared by journalists on WhatsApp.
A spokesman for the ED refused to comment.
Modi is one of India’s richest men. He is worth $1.73 billion according to Forbes, placing him 85th on India’s rich list.
The 47-year-old is the founder of jewellery giant Firestar Diamond. His high-end Nirav Modi brand has stores in several of the world’s major cities.
Today’s raids came a day after the ED registered a money laundering case against Modi and a few others, including members of his family, a business associate and two employees of PNB.
It followed PNB’s complaint last month to India’s Central Bureau of Investigation (CBI) that it had been defrauded of Rs 2.8 billion.
The bank, India’s second-largest state-owned lender, announced yesterday (14) that it had also detected fraud of almost $1.8 billion at a single branch in Mumbai, sending its shares plummeting.
It made fresh allegations against Modi to the CBI.
The news agency, citing officials, reported on Thursday that Modi and his family had left India in early January, before the bank detected either of the two fraud cases.
It reported that Modi and his brother left on January 1. The officials added that Modi’s wife and Mehul Choksi, his uncle and business partner, left on January 6. All are being investigated by the CBI.
In late January, shortly before the fraud allegations were made, Modi was photographed alongside India’s prime minister Narendra Modi at the World Economic Forum in Davos. The two are not related.
Cabinet minister Ravi Shankar Prasad said Nirav Modi was not part of the prime minister’s delegation at the global gathering in Switzerland.
“He went to Davos on his own. He joined a photograph of Indian businessmen. In no way does it show any connection,” Prasad told reporters.
Modi, the third generation of his family to go into the diamond trade, has not commented on the allegations. Firestar Diamond has previously said the earlier case was not connected to the company.
The trouble comes as India’s government is trying to reduce the crippling debts of the country’s embattled lenders, including PNB.
It recently announced a $32-billion recapitalisation plan for state-owned banks to help them clean up their books.
PNB shares closed down almost 12 per cent today.