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MUMBAI: Diamond merchants Nirav Nirav Modi and his uncle Mehul Choksi , who are accused of defrauding Punjab National Bank of Rs 12,300 crore, brought back most of the money into accounts of their Mumbai-based companies through fake transactions, in many cases on the same day. Investigating officials say they have found evidence of round-tripping through hawala deals.

Investigators have discovered that in many instances Choksi brought money from overseas into the account of his company, Gitanjali Gems . He subsequently diverted these funds into accounts of various dummy (shell) companies describing the transfers as unsecured loans, from where it was siphoned off through various means, including cash withdrawal, said a probe official.

“In Nirav Modi’s companies, money was diverted after a few days through bogus transactions, but in Choksi’s companies, including Gitanjali Gems, there were many instances when the money returned to India within 24 hours,” an officer involved in the probe said. Multiple agencies, including the CBI, the ED and the SFIO, are probing the fraud. The ED has already sent a letter of request to Hong Kong and Dubai and 10 other countries asking them to give details of alleged bogus firms involved in transactions.

Most of the 20 dummy firms are based in Hong Kong and Dubai. Officials said that of the Rs 12,300 crore, Nirav Nirav Modi was responsible for transactions amounting to Rs 6,500 crore while the remaining Rs 5,800 crore was by Choksi. Officials said they were yet to record statements of directors of the overseas shell companies. However, they have concluded that theses firms were controlled by Nirav Modi-Choksi . The duo had obtained letters of undertaking, akin to bank guarantees, without the bank’s authorisation by colluding with officials of PNB ’s Brady House branch in Mumbai.

These guarantees were used to obtain loans abroad ostensibly to pay for imports. According to investigators, the two would submit forged papers related with imported jewellery. Once the funds were released to suppliers overseas, the suppliers, believed to be fronts for Nirav Modi and Choksi group firms, sent the money back to India into accounts of shell firms owned by the duo through fictitious transactions.

Investigations have revealed the companies involved in the transaction abroad were bogus firms and there directors were earlier employed with Nirav Modi and Choksi. Firestar Diamond and Gitanjali Gems were key to laundering the transactions. Meanwhile, the Directorate of Revenue Intelligence has booked Nirav Modi and his firms in a Rs 52 crore duty evasion case where he had allegedly diverted jewels worth Rs 890 crore, meant for export, to the Indian market.



In Video: DRI registers case against Nirav Modi, says he diverted diamonds worth Rs 890 crore