Billionaire jeweler denies involvement in huge Indian bank fraud

A demonstrator holds an effigy depicting billionaire jeweler Nirav Modi during a protest in Kolkata. Indian officials are on the lookout for Modi and his family, who police say left India in January prior to the case being filed. (Reuters)
Updated 20 February 2018
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Billionaire jeweler denies involvement in huge Indian bank fraud

NEW DELHI/MUMBAI: Indian billionaire jeweler Nirav Modi, one of the prime accused in the country’s largest ever bank fraud, denies allegations leveled against him by Punjab National Bank (PNB), his lawyer said on Tuesday.
“There is nothing, there is nothing in it,” Vijay Aggarwal, a lawyer representing Modi, told Reuters, referring to the police complaint filed by PNB that alleges that companies linked to Modi and one of his relatives received credit worth nearly $1.8 billion between 2011 and 2017 using false guarantees supplied by two bank officials.
Aggarwal, speaking by telephone, declined to comment on where Modi was. Indian officials are on the lookout for Modi and his family, who police say left India in January prior to the case being filed.
“Everything is documented,” Aggarwal said of Modi’s dealings with PNB, adding that the state-owned bank had regularly levied fees on its dealings with the jeweler’s firms.
Asked about his legal strategy, Aggarwal said: “Until there is no chargesheet, there is no strategy. When there is a chargesheet, there will be a strategy.”
According to a police complaint by PNB, the two officials at a Mumbai branch of the bank steered fraudulent loans to companies linked to Modi and entities tied to jewelry retailer Gitanjali Gems, which is led by Modi’s uncle, Mehul Choksi.
“They are covering themselves up,” Aggarwal said of the complaint. “They want to avoid liability ... that is why they are cooking up this story.”
Choksi, who has also left the country, has not commented. Gitanjali, in a stock exchange filing, has denied Choksi’s involvement in the alleged fraud.
Five bank officials, including the two at the Mumbai branch, have been arrested.
The fraud case has stunned financial markets and it sent PNB shares tumbling for a fifth straight trading day on Tuesday.
Shares in PNB, which has shed nearly a third of its market value since disclosing the fraud, were down 3.5 percent in early trading after rating agency Fitch placed the bank on negative watch. Later, Moody’s also placed the bank’s ratings under review for a downgrade.
Separately, in a letter to PNB officials, Modi stated that his companies owe the bank under 50 billion rupees ($775.25 million), much lower than the amount alleged by the bank. He also said PNB has jeopardized its chances of recovering the sums owed by going public with its allegations.
“The erroneously cited liability resulted in a media frenzy which led to immediate search and seizure of operations, and which in turn resulted in Firestar International and Firestar Diamond International effectively ceasing to be going-concerns,” he wrote in a letter seen by Reuters. “This thereby jeopardized our ability to discharge the dues of the group to the banks.” Both companies are controlled by Modi. The fraud allegedly involves at least three firms controlled by Modi and others by Choksi.


Arrests follow rape of Indian anti-trafficking activists

Updated 36 min 17 sec ago
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Arrests follow rape of Indian anti-trafficking activists

  • At least 60 NGOS in four networks are working on a memorandum asking the state to protect activists
  • More recently it brought in the death penalty for those who rape children under the age of 12 following a national outcry over the gang rape

NEW DELHI: Police have made a series of arrests in connection with the abduction and rape at gunpoint of five anti-trafficking campaigners in the central Indian state of Jharkhand early this week.

Khunti police station officials, where the incident happened, told Arab News that three people have been arrested, including the head of the school where the play was being performed. 

Police superintendent Ashwini Kumar Sinha said a leader of a local movement called Pathalgadi instigated the accused, saying that the play performers were against the movement and should be taught a lesson. 

Pathalgadi is a political movement whose followers recognize their village councils as the only sovereign authority and views all outsiders suspiciously.

Activists working in the area say the incident has left them shocked and worried for their safety.

Earlier this week, nine activists were abducted while performing a street play in Kochang village and driven into a forest, where they were beaten and the women raped.

The activists were from the nonprofit organization Asha Kiran, which runs a shelter in the Khunti district for young women rescued from trafficking. Activists say that while such incidents are rare, the abductions have shaken the community.

“There is definitely fear now,” said Rajan Kumar, of Sinduartola Gramodaya Vikas Vidyalaya, a nonprofit group campaigning against people trafficking in the district. 

“But people have to work. We need to do more to take members of the village council into our confidence.”

Rajiv Ranjan Sinha, of the Jharkhand Anti-Trafficking Network, a coalition of 14 organizations, said the incident has frightened everyone.

“We’ve never had to face this before,” Sinha said. “But it will definitely have an implication. New people will be scared to go into the field.”

On Saturday, several non-profit organizations called for a silent protest march at 10 a.m. in the state capital Ranchi on Sunday.

At least 60 NGOS in four networks are working on a memorandum asking the state to protect activists and to take seriously the issue of violence against women.

“We are not only NGO workers, but we are female also,” a spokeswoman said. “There is a lot of fear among workers now.”

India has a poor record of sexual violence against women — at least 39,000 cases were reported in 2016, the latest government data available. Activists say many more incidents go unreported.

The country changed its rape laws and introduced Protection of Children Against Sexual Offences legislation after the rape and murder of a 19-year-old student in December 2012 in the Indian capital.

More recently it brought in the death penalty for those who rape children under the age of 12 following a national outcry over the gang rape and murder of an 8-year-old girl in the northern state of Kashmir.

The girl was kidnapped, drugged and raped in a temple where she was held captive for several days before being beaten to death.