PNB moves Hong Kong High Court seeking action against Nirav Modi, Mehul Choksi

The PNB is seeking the seizure of Nirav Modi's bank accounts and attaching his assets and businesses in Hong Kong. 

PNB moves Hong Kong High Court seeking action against Nirav Modi, Mehul Choksi

NEW DELHI: The Punjab National Bank (PNB) on Saturday approached the Hong Kong High Court seeking action against beleaguered diamond trader Nirav Modi, who is a key accused in the Rs 12,700-crore fraud linked with the bank. According to ANI, the PNB is seeking the seizure of Nirav Modi's bank accounts and attaching his assets and businesses in Hong Kong. 

ANI also reported that PNB has also decided to approach the concerned courts in other countries where Nirav Modi and his jeweller uncle Mehul Choksi have their assets and businesses.

Importantly, China had last week said that the administration in Hong Kong can accede to India's request to arrest fugitive diamond merchant Nirav Modi based on local laws and mutual judicial assistance agreements.

Minister of State for External Affairs VK Singh had informed the Parliament last week that "the Ministry has sought the provisional arrest of Nirav Modi by the Government of the Hong Kong Special Administrative Region (HKSAR), the People's Republic of China."

Asked about India's request, Chinese Foreign Ministry spokesman Geng Shuang said in a media briefing that "according to the one country two systems and basic law of the HKSAR, under the assistance and authorisation of the central government, the HKSAR can make proper arrangement on judicial mutual assistance with other countries."

"If India makes a relevant request to the HKSAR, we believe the HKSAR will follow the basic law and relevant laws and under relevant judicial agreements with India with the relevant issue," he said.

Nirav Modi, who is wanted in connection with the 12,700-crore scam at the Punjab National Bank, has been traced to be hiding in Hong Kong which is a special administrative region of China.

It then sent a formal request to Hong Kong for the diamond trader's provisional arrest.

Nirav Modi has his shop in Hong Kong besides in Beijing. Nirav Modi and his jeweller uncle, Mehul Choksi, are accused of defrauding the PNB to the tune of around Rs 12,700 crore.

The CBI has so far arrested 19 people in connection with the PNB fraud. The Enforcement Directorate (ED) is also conducting an independent probe into the scam.

It is alleged that LoUs (letters of undertaking) and LCs (letters of credit) worth close to USD 2 billion were issued fraudulently to the companies of the uncle-nephew duo from the PNB's Brady House Branch in south Mumbai through SWIFT (Society for Worldwide Interbank Financial Telecommunication) messages.

Several bank employees have been booked for collusion in the case, CBI and ED officials have said. A LoU is a guarantee which is given by an issuing bank to the Indian banks that have branches abroad to grant a short-term credit to the applicant.

In case of default, the bank issuing the LoU has to pay the liability to the credit-giving bank, along with interest. Both Choksi and Modi have been booked in two cases each related to the bank fraud, which came to light in February.

The uncle-nephew duo had fled the country in the first week of January, days before the PNB detected the fraud. 

(With Agency inputs)

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