Why PNB scam accused Nirav Modi’s 16 companies filed for winding up in last three months

By: | Updated: August 29, 2018 11:02 AM

Nearly 16 companies allegedly linked to fugitive diamond jeweller Nirav Modi have filed for liquidation in the last three months.

PNB accused Nirav Modi controlled these firms through ‘dummy directors.’. (image: Facebook)

PNB scam accused Nirav Modi: Nearly 16 companies allegedly linked to fugitive diamond jeweller Nirav Modi have filed for liquidation in the last three months, The Indian Express report said. The firms in United Arab Emirates (UAE) and Hong Kong were allegedly operated by Nirav Modi through ‘dummy directors,’ the report also said. The two Hong Kong-based firms namely Auragem Company Ltd and Sino Traders filed for liquidation on May 25 and July 4, respectively. These had received Rs 5,921 crore of the fraudulent letters of undertaking (LoUs) issued by fraud-struck Punjab National Bank (PNB).

The other firms including Brilliant Diamonds Ltd (June 4), Eternal Diamonds Corporation Ltd (June 6), Fancy Creations Company Ltd (May 25) and Sunshine Gems Ltd (June 7) have also applied for winding up. The companies have been wound up under the “creditors’ voluntary winding up” process started by the company directors.

Ten other dummy firms which were operated by Modi have also filed for liquidation, the report also said. Between 2011 and 2017, a few of these firms including Unique Diamond and Jewellery FZC, Universal Fine Jewelry FZE, Vista Jewelry FZE,received nearly Rs 7,000 crore through PNB LoUs. On March 19,  Firestar Diamond Inc and A. Jaffe had filed for bankruptcy protection in the United States.

Meanwhile, it was in January earlier this year that Punjab National Bank filed a complaint against Modi and companies controlled by him, alleging that he in connivance with a few of the bank officials fraudulently borrowed $4 billion over years by creating sham transactions as a way to import diamonds and other gems into India.

Nirav Modi along with his uncle Mehul Choksi has been named as the main accused in the Rs 14,000 crore Punjab National Bank fraud case. Both accused are on run currently.

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