New Delhi: Fugitive diamond trader Mehul Choksi, accused of orchestrating a Rs. 13,000 crore fraud involving the Punjab National Bank (PNB), has been detained in Belgium.
Indian investigative agencies, including the Central Bureau of Investigation (CBI) and the Enforcement Directorate (ED), confirmed his arrest on Saturday after a formal extradition request was submitted.
Choksi, 65, left India in 2018 and had been residing in Antigua under the guise of seeking medical treatment.
Officials reported that Choksi had been under surveillance in Belgium since last year.
Indian authorities acted swiftly, leveraging multiple open-ended arrest warrants issued in Mumbai in 2018 and 2021 as part of the extradition effort.
The PNB scam, one of India’s largest banking frauds, involved fraudulent issuance of Letters of Undertaking (LoUs) and Foreign Letters of Credit (FLCs) by PNB’s Brady House branch in Mumbai.
These financial instruments, issued without due procedure or adequate collateral, facilitated significant loans from international banks, which were defaulted upon by Choksi’s firms, including Gitanjali Gems.
The fallout of the scam led PNB to pay Rs. 6,344.97 crore, including interest, to overseas banks that extended credit based on the fraudulent guarantees.
The ED has seized or attached assets worth Rs. 2,565.90 crore linked to Choksi and his companies, with court approval granted for their monetization.
Choksi’s nephew, Nirav Modi, also implicated in the case, has been in a UK prison since 2019, contesting extradition to India.
Together, Choksi and Modi are accused of using 165 LoUs and 58 FLCs issued between March and April 2017 to siphon off funds.
Choksi’s detention marks a critical milestone for Indian authorities in their pursuit of economic offenders.
Sources suggest that while Choksi may appeal for bail on health grounds, Indian officials remain steadfast in their commitment to bringing him back for prosecution.
Interpol’s removal of a Red Notice against Choksi last year complicated efforts, forcing Indian agencies to rely solely on the extradition route.
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Despite challenges posed by his financial resources and legal defenses, authorities are optimistic about securing his return, emphasizing India’s resolve to combat financial crimes and ensure accountability.
The legal process for Choksi’s extradition is underway, with Indian agencies preparing detailed documentation to bolster their case.
Meanwhile, this development follows India’s recent success in extraditing Tahawwur Rana, demonstrating a growing momentum in bringing fugitives to justice.
