The brother of fugitive businessman Nirav Modi was arrested in the United States on July 4, based on an extradition request by the Indian authorities. Nehal Modi is a key accused in the Rs 13,000 crore Punjab National Bank (PNB) scam; his arrest was confirmed by the US Department of Justice on July 4.

Who is Nehal Modi?

Nehal Deepak Modi was born in Belgium. He is the younger brother of Nirav Modi, who has been accused of playing a crucial role in the Nirav Modi-Mehul Choksi PNB fraud. Nehal helped in the concealment of illicit funds and moderated fake companies and cross-border transactions. As per investigation reports, Nehal assisted in the destruction of evidence and intimidation activities of Dubai-based shell companies, masking illegal trade.

Nehal Modi’s network reportedly acquired fraudulent Letters of Undertaking (LoUs) worth Rs 10,000 crore issued by the bank and diverted a rough estimate of Rs 6,498 crore.

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Now, after a joint requisition from the Central Bureau of Investigation (CBI) and the Enforcement Directorate (ED), Nehal Deepak Modi has been arrested. Moreover, a status conference is to be held on July 17, which will discuss his extradition process. American prosecutors, from the Department of Justice, have expressed their intention to oppose his release.

Nirav Modi PNB scam

The Punjab National Bank scam was masterminded by jeweller Nirav Modi and his maternal uncle, Mehul Choksi. Bankers at PNB’s Brady House branch in Mumbai used fake Letters of Undertaking (LoUs) for pearl imports, violating RBI’s 90-day credit limit by extending it to a year.

RBI’s guideline was ignored by the overseas branches of Indian banks, and they failed to inform PNB about documents submitted by Nirav Modi’s firms. Starting in March 2011, Modi secured 1,213 fraudulent LoUs for over 74 months. The Enforcement Directorate recovered bank tokens used by his dummy firms in tax havens and found that his brother, Nehal Modi, destroyed key devices and hid a UAE-based server. So far, the ED has seized assets worth Rs 2,362 crore in the scam.

Nehal faces two primary charges of money laundering under the Prevention of Money Laundering Act (PMLA), 2002, and criminal conspiracy under the Indian Penal Code (IPC).