Diamonds Are Not Forever: A Rich Indian Diamantaire Who Became Fugitive Is Now So Poor That His Company Can't Even Buy One 'Gadar 2' Ticket

Riches To Rags: Nirav Modi is an Indian businessman who was at the center of a major financial scandal involving Punjab National Bank (PNB), one of India's largest public sector banks. The scandal, often referred to as the 'PNB scam', came to light in early 2018. Here are the key details and the downfall of Nirav Modi.

Nirav Modi: Background

Nirav Modi was a jeweler known for his high-end diamond jewelry designs. He operated through his company, Nirav Modi Limited, which had stores in various countries.

Nirav Modi: Scam Unveiled

The scam revolved around fraudulent issuance of Letters of Undertaking (LoUs) by PNB officials to Nirav Modi's companies without proper collateral or due process. These LoUs were essentially guarantees to overseas banks for obtaining credit on behalf of the Modi-owned firms. Nirav Modi's companies allegedly colluded with PNB officials to obtain these LoUs, which allowed them to raise funds from foreign banks. The fraudulent LoUs were not recorded in the bank's core banking system, allowing the scam to continue undetected for a significant period.

Biggest Indian Banking Fraud

The scam was initially estimated to be around $1.8 billion, making it one of the largest banking frauds in India's history. Nirav Modi fled India in early 2018, around the same time the scam was uncovered. He was able to leave the country before the authorities could take action. He faced legal proceedings in multiple countries, including the United Kingdom, where he was arrested in March 2019.

Extradition Process

Following his arrest in the UK, extradition proceedings were initiated by Indian authorities to bring Nirav Modi back to India to face trial. The legal process involved multiple hearings and considerations. The PNB scam highlighted issues related to banking regulations, internal controls, and corporate governance in India. It led to increased scrutiny of the banking sector and calls for reforms to prevent such frauds in the future.

Nirav Modi: Riches To Rags

The once-notable diamond businessman and millionaire Nirav Modi is presently going through his toughest financial period. The arrest of Modi by London police in 2019 for his suspected participation in massive financial irregularities connected to the Punjab National Bank (PNB), which involved thousands of crores, marked the beginning of Modi's collapse. Recent reports indicate that Firestar Diamond International Pvt. Ltd. (FDIPL), Nirav Modi's business, has a pitiful bank balance of Rs 236, according to these claims. According to a Times of India report, one of Modi's company's bank accounts has just Rs 236 left after Kotak Mahindra Bank transferred Rs 2.46 crore to SBI to pay income tax debts, while two other banks, Union Bank of India and Bank of Maharashtra, only transferred a portion of the full amount due.

Nirav Modi's path is one of sharp contrasts, starting with him being a third-generation diamond merchant who grew up in the European jewelry center of Antwerp, Belgium, and ending himself in one of Europe's most crowded jails.