'Mehul Choksi diverted Rs 3,257 crore to foreign dummy companies'

Fugitive diamnond jeweller Mehul Choksi wanted in the Rs 13500crore Punjab National Bank PNB fraud case diverted over Rs 3257 crore of the money raised from fraudently obtained letters of undertaking LOUs and foreign letters of credit FLCs to overseas dummy firms an informed source said on TuesdayThe Enforcement Directorate ED source revealed that Choksi of the Gitanjali Group who acquired the Antiguan citizenship also highly inflated the prices of precious metals sold from his business outlets and diverted about 106 million to his nephew Nirav Modi and his father Deepak ModiThe ED source requesting for anonymity told IANS Over Rs 3250 crore was diverted and deposited in the Gitanjali Group firms in the US United Arab Emirates Thailand the United Kingdom Hong Kong Japan Italy and BelgiumEarlier on Tuesday Choksi in his first message from his hideout in Antigua denied allegations of wrongdoing and instead accused the ED of illegally attaching his propertiesIn the video message the fugitive diamantaire said that his Indian passport was suspended without giving him any opportunity to explain A Red Corner Notice RCN against Choksi is pending with the InterpolThe ED in its charge sheet against Choksi had alleged that from 2015 onwards a part of the funds was used for repayment of dues of various banks On scrutiny of the bank account details of the said Indian entities it was found that huge amounts of debits have been allegedly made from the accounts of these entities maintained with the PNB to the overseas companies of the Gitanjali GroupDuring investigation it was revealed that transfer of funds was made to the 4Cs Diamonds Distributors Crown Aim Ltd Shangyang Gong Si Ltd Taipingyang Trading Ltd Abecryst Thailand Ltd and Asian Diamond and Jewellery FZE from the accounts of the Indian entitiesThe source revealed that the Gitanjali Group owner also involved Nirav Modi who is also wanted in the case by the Indian investigation agencies using several dummy companies to rotate fundsThe source said that Choksi diverted 5612 million of loan money to his nephew and about 50 million to Nirav Modis father Deepak ModiIn its charge sheet the financial probe agency alleged that Choksi used several dummy companies for rotating his transactionsUnder this arrangement the origin of sale transactions and final destination used to be any of the Gitanjali Group of companies And for inbetween transactions dummy companies were used for layering purpose wherein only sale or purchase bills were created and no movement of goods took place Choksi has been doing this to project inflated turnover to avail higher banking facility the charge sheet saidThe ED claimed that Choksi used to fix the value of goods without applying economic rationale The goods in question were either of low value or poor quality and were not commensurate with the price or value fixed by him the ED saidThe charge sheet alleged that these goings on were confirmed by Gitanjali Groups Vice President Vipul Chitalia in his statement to the agency under the Prevention of Money Laundering ActThe agency said that the proceeds of crime of money laundering were partly remitted back to the Gitanjali Group of companies in India in the guise of exportimport transactions for settling earlier credit liabilitiesChoksi and Nirav Modi are under probe by both the CBI and ED The ED had on May 24 and 26 filed the charge sheets against both The court took cognisance and issued nonbailable warrants against themNirav Modi left India along with his family in the first week of January weeks before the scam was reported to the CBI His wife Ami a US citizen left on January 6 and Choksi on January 4Catch up on all the latest Crime National International and Hatke news here Also download the new midday Android and iOS apps to get latest updatesThis story has been sourced from a third party syndicated feed agencies Except for the change in the headline the story has been provided ASIS AS AVAILABLE without any verification or editing from our side Midday accepts no responsibility or liability for its dependability trustworthiness reliability and data of the text Midday managementmiddaycom reserves the sole right to alter delete or remove without notice the content in its absolute discretion for any reason whatsoever