How did a man wanted for India’s biggest bank scam land up on a distant Caribbean island nation—bruised, black-eyed, and bearing an incredulous tale of being a target of an alleged rendition? Since he fled India in 2018 after being wanted for defrauding the Punjab National Bank (PNB), the Mehul Choksi saga has taken some astonishing twists. None as sensational it would seem as the events of the past few days. Choksi, 62, alleged he was honey-trapped by a woman he had met on the island of Antigua, where he had been in hiding since he fled India. He was allegedly tased, beaten up, tortured by unidentified people of Indian origin, and spirited away on a yacht to Dominica, another island nation.
The diamond merchant, who was once the envy of the South Mumbai trade and carved up a multibillion-dollar global diamond empire, has his back to the wall. He is simultaneously battling the law of three countries—India, where the CBI (Central Bureau of Investigation) and Enforcement Directorate (ED) want him back to stand trial for bank fraud; Antigua, which recently stripped him of its citizenship after discovering an Interpol Red Corner Notice (RCN) against him; and Dominica, which is investigating his abduction story and his plea for deportation back to Antigua. Either ways, the proceedings over the next few days have put the fugitive diamantaire within a hair’s breadth of something which didn’t seem possible until recently— being thrust into a jet to face the law back in India.
THE GREAT ESCAPE ARTIST
In January 2018, PNB authorities told the police that Choksi and his nephew Nirav Modi had defrauded them of Rs 13,500 crore. It was by far India’s largest-ever bank scam. The mind-boggling numbers easily eclipsed India’s largest bank robbery—the October 2014 heist in Haryana’s Sonepat, where thieves burrowed into a PNB branch and stole valuables estimated to be worth Rs 100 crore.
Choksi’s alleged scam spanned the globe. A 132page report submitted to the US bankruptcy court in Delaware on February 20, 2019 lists how he did it. From his sea-facing duplex penthouse on Malabar Hill, the portly diamantaire ran a global web of international diamond firms that swindled banks by allegedly bribing key bankers. The alleged fraud consisted of obtaining bank loans by raising fraudulent Letters of Undertakings (LoUs) and showing sham transactions to ‘import’ jewellery into India through a web of secretly controlled shell entities.
Choksi was born into a Palanpuri Jain business family engaged in diamond trade. India accounts for over 70 per cent of all the world’s exports of cut and polished diamonds. Palanpuri Jains are one of the two communities controlling India’s diamond trade (the other being the Kathiawadi Patels). The community is small, tightly knit, and traces its origin to Palanpur, a town in Gujarat’s Banaskantha district bordering Rajasthan. Members of this wealthy community are strictly vegetarian and travel with their own cooks when they vacation overseas.
When his alleged fraud was close to being discovered, Choksi jetted away to the United States in early 2018, and from there to the Caribbean islands of Antigua and Barbuda, where he had acquired citizenship through an investment scheme in 2017. The Caribbean Sea countries comprise around 16 small nations; many of them serve as offshore tax havens and Flags of Convenience for merchant vessels.
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THE RUMBLINGS WITHIN
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