PNB scam: Nirav Modi declared fugitive economic offender by special court in Mumbai; second businessman after Vijay Mallya to get tag

Mumbai: A special court in the financial capital on Thursday declared diamond businessman Nirav Modi, the key accused in the $2 billion Punjab National Bank (PNB) fraud case, a fugitive economic offender, on a plea of the Enforcement Directorate (ED). He is the second businessman after liquor tycoon Vijay Mallya to be declared a fugitive economic offender under provisions of the Fugitive Economic Offenders (FEO) Act which came into existence in August, 2018. Special PMLA court Judge VC Barde declared Nirav Modi a fugitive economic offender after hearing extensive arguments of lawyers of the diamantaire and the ED. Nirav Modi had earlier urged the court to set aside the ED’s plea to declare him an FEO. [caption id=“attachment_4420023” align=“alignleft” width=“380”] A file image of Nirav Modi. News18[/caption] Nirav and his uncle Mehul Choksi are the main accused in the PNB scam and they both left India before details of the fraud came to light in January, 2018. He was arrested in London in March, 2019, and his extradition process is pending. In July 2018, the central agency filed an application under the newly-promulgated FEO Act to declare him a fugitive economic offender. His lawyer earlier claimed that the ED was relying on evidence and statements recorded under the Prevention of Money Laundering (PMLA) Act to seek a remedy under the FEO Act. “This was not permissible under the FEO Act,” he said. As per the investigating agency, Nirav and his uncle Choksi, in connivance with certain bank officials, allegedly cheated the PNB to the tune of Rs 14,000 crore through issuance of fraudulent Letters of Undertaking (LoUs). These LoUs were allegedly issued in a fraudulent manner by a Mumbai branch of the PNB to the group of companies belonging to Nirav Modi since March, 2011, till the case came to light. Under the FEO Act, a person can be declared a fugitive economic offender if a warrant has been issued against him for an offence involving an amount of Rs 100 crore or more and he has left the country and refuses to return.