Mumbai, Feb 15: A day after a massive $1.8 billion fraud was unearthed in a PNB branch here, the Enforcement Directorate on Thursday launched a nationwide raid on the offices, showrooms and workshops of billionaire diamond trader Nirav Modi.
ED teams carried out simultaneous raids on Modi’s offices, showrooms and diamond workshops in Mumbai, Surat (Gujarat) and New Delhi.
ED officials landed at Firestar Diamond Pvt Ltd. head office in Bharat Diamond Bourse, in Bandra Kurla Complex, Modi’s private office at Kohinoor City in Kurla West, his showroom and boutique at Itts House in Fort in south Mumbai and a workshop in Peninsula Business Park in Lower Parel.
In Gujarat, six diamond workshops were raided in Surat SEZ at Sachin town and an office in Belgium Towers on Ring Road, the hub of diamond jewellery trade.
Two diamond jewellery boutiques of Modi in New Delhi – in Chanakyapuri and Defence Colony – were also raided.
The multi-pronged action came a day after the Punjab National Bank admitted to unearthing a fraud of Rs 11,515 crore involving Modi’s companies and certain other accounts with the bank’s flagship branch (Brady House) in Mumbai and its second largest lending window in India.
At least 10 bank employees have been suspended but it is not clear whether anybody from the crucial PNB Credit Approval Committee or its Board of Directors figure among them.
The fraud, which includes money-laundering among others, concerns the Firestar Diamonds group in which the CBI last week booked Modi, his wife Ami, brother Nishal and a maternal uncle Mehul Choksi.
It followed a complaint lodged by PNB on January 29 pertaining to an alleged cheating case of Rs 280 crore perpetrated by these four in 2011.
It is learnt that Modi – whose operations are spread across Europe, the US, Middle East and Far East besides India – has written to PNB and other banks that he would return their outstandings.
The latest case — which involves a sum considerably higher than the Vijay Mallya default of around Rs 9,000 crore — comes at a time when the Indian banking system is already grappling with swelling non-performing assets.