PNB fraud accused Choksi says Indian authorities ignoring due process

In this file photo, pedestrians walk past a Punjab National Bank office in Mumbai, India. (Reuters)
Updated 08 March 2018
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PNB fraud accused Choksi says Indian authorities ignoring due process

MUMBAI: Mehul Choksi, the jeweller accused of being a central figure in an alleged fraud of nearly $2 billion against Punjab National Bank, criticized India’s investigating agencies in a letter alleging gross abuse of due process in the ongoing probe.
In a letter to the Central Bureau of Investigation (CBI), one of the lead agencies probing the alleged loan fraud, Choksi said the seizure of his assets, bank accounts and the shutting down of all his offices in India has caused prejudice against him.
In the letter dated Mar. 7, which was reviewed by Reuters on Thursday, Choksi said investigating agencies were acting with pre-determined minds and interfering with the course of justice.
In what has been dubbed the biggest fraud in India’s banking history, Punjab National Bank (PNB) and police have accused two jewelry groups — one controlled by diamond tycoon Nirav Modi and the other by his uncle Choksi — of colluding with some bank employees to secure credit from overseas banks using fraudulent guarantees.
Choksi, who heads Gitanjali Gems, which operates stores under banners including Gili, Nakshatra and Asmi, said in his letter that while the CBI has seized his assets, it has yet to submit a “Seizure Memo” in court, as required by law.
Choksi, who authorities say left India before the complaint against him was filed and whose passport has been suspended, said he feared greatly that he would not get “fair treatment and a fair trial” if he returned.
Both Choksi and Modi have denied the allegations and lawyers for the two key accused PNB employees in the case have also said they are innocent. The whereabouts of Choksi and Modi, who police say also left India in January, are unknown.
A spokesman for the CBI said he did not have any immediate comment on Choksi’s letter.
Choksi said in the letter he had traveled abroad on business before the complaints were made and his departure was not “a direct result” of the allegations against him.
Local media reported last week that a Mumbai court issued non-bailable arrest warrants against Modi and Choksi following an appeal by the Enforcement Directorate (ED), an Indian agency focused on foreign exchange and money laundering offenses.
Choksi said in the letter that he had undergone a cardiac procedure during the first week of February and he was unable to travel for at least four to six months as the procedure was yet to be completed. He did not say where he was.
The jeweller also told the agency he was being threatened by individuals with whom he has a business relationship and that his employees, customers and creditors have started expressing their “animosity” after his business was shut down.
Choksi, accused the media of unfair coverage in the letter, and said politicians were politicizing the case and creating a bias against him.
Police have also so far arrested 19 people including eight of PNB’s current and former employees, along with executives from jeweller Nirav Modi and his uncle Mehul Choksi’s companies.
A source and documents reviewed by Reuters on Tuesday showed the amount involved in the fraud is likely to rise beyond the $2 billion mark.


Cost of eating out in Saudi Arabia rises at fastest rate in five years

Updated 25 September 2018
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Cost of eating out in Saudi Arabia rises at fastest rate in five years

  • August data reveal sharp uptick in prices in hotel and restaurant sector
  • But price increases in other sectors slow leaving overall inflation rate flat

LONDON: The cost of eating out or enjoying a night’s stay at a hotel in Saudi Arabia increased at the fastest rate recorded in five years last month, according to government statistics.
August’s consumer price data show that restaurant and hotel inflation rose to a new high of 8.4 percent year-on-year in August from 7.6 percent year-on-year in July.
Slower price increases in other categories ensured the headline inflation rate for the Kingdom remained relatively flat, with inflation staying at 2.2 percent year-on-year in August, unchanged from the previous month.
Analysts forecast that the Kingdom’s inflation rate will likely pick up again towards the end of the year.
“We still expect it to rise a little over the rest of this year as underlying price pressures pick up,” said Jason Tuvey, senior emerging markets economist at Capital Economics, on Tuesday in a research note.
Inflation in Saudi Arabia peaked earlier this year at 3 percent following the introduction of the new value-added tax on certain goods and the government-imposed price hikes on the cost of energy at the start of 2018.
Consumer prices are expected to drop again in the new year as the impact of the VAT charge lessens, analysts predict.
“The upshot is that we expect that inflation will fall to around 1 percent year-on-year in January 2019,” said Tuvey in a note.
Food inflation - which represents 20 percent of the basket of goods and services used to calculate the growth rates in consumer prices - edged downwards in August to 6.6 percent year-on-year compared to 6.7 percent in July. 

The cost of food had jumped in July, with vegetables in particular becoming more expensive with inflation hitting 8.1 percent year-on-year compared to a decline of 0.8 percent year-on-year recorded in June.