UK court rejects Nirav Modi's plea

British HC Rejects Nirav Modi’s Plea Against Extradition

Fugitive diamond businessman Nirav Modi on Wednesday lost his appeal against extradition to India with a United Kingdom court dismissing his plea.

The High Court of London (United Kingdom) on Wednesday dismissed the appeal of Nirav Modi, who is wanted in India to face money laundering and fraud cases.

Nirav Modi, who is a prime accused in the Rs 13,500 crore PNB scam, had fled India. He lost his appeal after he had moved High Court in London against extradition on mental health grounds.

The Bench of Justice Stuart Smith and Justice Robert Jay of the High Court said “no features of psychotic illness”.

The court rejected Nirav Modi’s counsel’s claims that he will die by suicide due to severe depression and said “Nirav Modi neither is nor is very likely to be at the most severe end of the scale of depressive illness”.

“He has so far displayed no features of psychotic illness. Although he has exhibited persistent suicidal ideation, he has neither attempted suicide or deliberate self-harm nor disclosed plans to do so, except in the most vague and general way,” the court said.

The High Court also noted the steps taken to render Barrack 12 safe and to ensure that there is effective constant monitoring to reduce both the risk of attempted suicide and the prospect of suicide being committed.

The Court noted that the appellant, Nirav Deepak Modi, is sought by the Government of India.

The High Court noted the sets of criminal proceedings before it. The first, brought by the Central Bureau of Investigation (“the CBI”), relates to a fraud on the Punjab National Bank, which caused losses equivalent to over £700 million. The second, brought by the Enforcement Directorate (“the ED”), relates to the alleged laundering of the proceeds of that fraud.

“While, as we have said, the arrangements cannot entirely eliminate the risk of suicide, that is not the test. The starting point is that a high threshold has to be reached in order to satisfy the court that Mr (Nirav) Modi’s condition is such that it would be oppressive to extradite him. As we have said, the arrangements that will be in place, which have been the subject of assurances in response to the concerns and promptings of those acting for Modi, are appropriate,” noted the court.

“That is in itself an indication that they will enable the authorities to cope properly with Mr (Nirav) Modi’s condition and the risk of suicide. On the assumption that the arrangements are put into place in accordance with the GoI’s assurances, the residual risk is, in our judgment, greatly reduced, said the bench.

Nirav Modi last year had moved High Court against District Judge Sam Goozee’s Westminster Magistrate Court ruling in favor of extradition. He is presently behind the bars at Wandsworth prison in southeast London. (ANI)

Yes Bank Debacle & Crony Capitalism

The recent debacle of the Indian private sector bank, Yes Bank, whose board was suspended and superseded by the Reserve Bank of India (RBI), once again brings into sharp focus the extent and depth to which crony capitalism continues to prevail in the country’s economy.

Yes Bank was founded in 2004 by Rana Kapoor and his brother-in-law, the late Ashok Kapur. Early this month, the Central Bureau of Investigation (CBI), registered a criminal case against Kapoor, who was the CEO of Yes Bank; Dewan Housing Finance Ltd. (DHFL), a non-banking financial services company; and its promoter, Kapil Wadhawan. The CBI charged them with criminal conspiracy, cheating and corruption under the Indian Penal Code and the Prevention of Corruption Act.

ALSO READ: How To Pull Up Indian Economy

The allegations are that between April and June 2018, Yes Bank subscribed or invested Rs 3700 crores in DHFL’s short-term debentures. This financial assistance subsequently turned into non-performing assets as the bank was unable to recover the funds. More seriously, the allegations are that in lieu of the amount extended to DHFL, a company, Do it Urban Ventures, promoted by Kapoor’s three daughters, and received kickbacks in the form of loans amounting to around Rs 600 crores. In other words, the CBI alleges that Kapoor and DHFL entered into a conspiratorial quid pro quo: DHFL got the assistance (that have now turned into bad loans) and he and his family benefited from the kickbacks.

Rana Kapoor in custody of Enforcement Directorate

The agency has alleged that Rana Kapoor extended financial assistance to DHFL to get substantial undue benefit for himself and his family members via companies held by Kapoor and his family. On March 5, India’s central bank, the Reserve Bank of India, announced that it had suspended and superseded the board of Yes Bank. Customers were prevented from withdrawing more than Rs 50000 from their accounts and rating agencies downgraded the bank’s core bonds.

Yes Bank’s debacle turns the focus sharply on the continued prevalence of crony capitalism in India’s economy: an unholy nexus between banks, financial institutions (FIs), and business enterprises. Banks and FIs—and not only privately owned ones—in India are known to have cosy relationships with promoters of large and medium sized Indian companies and quid pro quo arrangements of the sort that Kapoor and Yes Bank are accused of are not uncommon. Rather, it is quite the opposite. Examples of misuse of bank funds are galore in the Indian economy.

One high-profile case is that of liquor baron Vijay Mallya who is currently in the UK while the Indian government is trying to get him extradited so that he can face investigation into charges levelled against him. Mallya is accused of misusing around Rs 9,000 crore (US$1.3 billion), which are loans that his companies, including a now-defunct airline that he started, took from 17 Indian banks. The allegations are that Mallya siphoned off these funds to 40 other companies that he controls around the world.

ALSO READ: Nirav Modi Arrested In London

In another headline-grabbing case in 2018, the CBI began an investigation into Nirav Modi, a high-profile Indian jeweller, on allegations that he and his partners defrauded the Punjab National Bank of Rs 28,000 crore, which he is alleged to have siphoned overseas by fraudulently obtaining letters of undertaking for making payments to overseas suppliers. Modi is absconding and is believed to be in the US even as the Interpol is looking for him.

More recently, in December 2019, another high-profile executive, Jagdish Khattar, the former managing director of Maruti Udyog Ltd., India’s largest carmaker, was booked by the CBI for charges against him of cheating the Punjab National Bank of Rs 110 crore. That case is still being investigated although Khattar has not been arrested.

These few examples are really the tip of the iceberg. Nefarious deals between banks and influential entrepreneurs abound in India. Not long ago, a private sector steel company was embroiled in a similar controversy when a partly government-controlled financial institution was believed to be lending it vast sums of money although past loans taken by the company had turned into non-performing assets.

The curious paradox about such cases is that in many of the cases, the authorities, including investigative agencies, wake up when it is already too late. In Yes Bank’s case, the RBI has been issuing warnings about financial inconsistencies in the bank’s reports. Doubts about Mallya’s ability to run his airline and manage his finances have been floating around long before he fled India.

The other, more disheartening, aspect of all this is the hagiographical treatment that the media have meted out to some of these controversial promoters and businessmen. Vijay Mallya, now 64, has had countless laudatory cover stories or “puff pieces” about him. Rana Kapoor, an aggressive publicity seeker, has found similar success with the Indian media. Jagdish Khattar was routinely lionised by India’s business press during his stint as managing director of Maruti between 2002 and 2007.

The truth is that India’s institutions, particularly in the financial sector, are prone to misuse—either because of the clout of powerful corporate borrowers or because of complicit bank officials, or both. India’s government has various laws, organisations and agencies that have been established to prevent financial fraud. Yet, with regular frequency, shocking instances of brazen misuse of the financial system come to light. What is needed is a will to break the cronyism that plagues the nexus between financiers and their corporate clients. And when frauds come to light, swift dispensation of justice could work as a deterrent.

Bank Loan Default

Nirav Modi Faces Arrest In London

In a major development, a London court on Monday issued an arrest warrant against diamond merchant Nirav Modi, who is wanted in India for an alleged loan default case, according to the sources in the Enforcement Directorate.

The arrest warrant was issued by the Westminster Court, the sources added.

India had already requested the extradition of Nirav Modi from the United Kingdom.

The development comes days after the fugitive was tracked down to a 33-storey Centre Point Apartment complex in London’s Theatre District.

The tower was an office complex and was converted into luxury residences with prices ranging from PS2 million to PS55 million all with superb views over the city of London.

Modi is believed to be living in a property worth PS8 million apartments in the tower, the rent for a similar apartment in the tower comes to approximately PS17,000 a month, stated the Daily Telegraph.

On March 9, Ministry of External Affairs spokesperson Raveesh Kumar had said that India is making strong efforts to bring back the fugitive businessman and was waiting for a response from the United Kingdom with regard to its extradition request sent in August last year.

At a media briefing here, Raveesh Kumar said the government is aware of Modi’s presence in the UK and had made the request for his extradition in August last year. He added that the fact the UK was sent that request clears that India is aware of his presence in that country and action has been initiated for his extradition.

Nirav Modi, one of the prime accused in the PNB scam in India. Modi is the subject of an extradition request by India, along with an Interpol Red Corner Notice being issued for the PNB scam accused. Modi is the prime accused in the Rs 13,000 crore PNB fraud, along with his uncle Mehul Choksi.

Choksi was granted citizenship of Antigua and Barbuda on January 15, 2018, while Modi is in London.

Both Modi and Choksi left India in January last year before the PNB scam came out in the public. The duo has not returned to India despite repeated summons from probe agencies and courts. (ANI)

Bank Loan Default

Nirav Modi Living Freely In London: Report

Wanted diamond trader Nirav Modi, one of the prime accused in the PNB scam in India, has been tracked down to an 8-million pound apartment in London’s posh locality West End by The Daily Telegraph.

An interview and a video with the wanted diamantaire published early Saturday in the British newspaper, revealed that Modi has also started a new diamond business in Soho.

The newspaper headlined its piece ‘Exclusive: India’s most wanted man Nirav Modi – accused of £1.5 billion fraud -living openly in London’.

The video shows Nirav Modi sporting a handle-bar moustache and wearing an expensive jacket, repeatedly saying “no comments” to a series of questions put to him by the newspaper’s reporter, including whether he has sought asylum in the United Kingdom.

Modi is the subject of an extradition request by India, along with an Interpol Red Corner Notice being issued for the PNB scam accused. Modi is the prime accused in the Rs 13,000 crore PNB fraud, along with his uncle Mehul Choksi. Choksi was granted citizenship of Antigua and Barbuda on January 15, 2018, while Modi is in London.

Both Modi and Choksi left India in January last year before the PNB scam came out in the public. The duo has not returned to India despite repeated summons from probe agencies and courts.

“Modi appears to have adopted a surprisingly nonchalant attitude to his fugitive status, walking his small dog each day between his apartment and the diamond company’s office in a townhouse in Soho, just a few hundred yards from his Centre Point home,” The Daily Telegraph said.

The newspaper, quoting government sources, also reported that Modi has been given a national insurance number – needed to legally work in the UK – and has been operating bank accounts online while being wanted by India.

“He has also been in contact with a wealth management company based in west London, which specialises in advice to rich foreigners. It is not clear why the British government has given him a national insurance number and yet has apparently failed to act on the Interpol red notice,” The Daily Telegraph said.

When confronted by the newspaper, Modi refused to comment if he has been granted political asylum in the United Kingdom or whether he is still trading in diamonds. “Sorry no comment,” he said, before walking across the road, dressed in an GBP 10,000 black Ostrich hide jacket.

On Friday, the PNB scam accused’s bungalow in Alibag at Raigad district in India was demolished by the authorities on orders of the Bombay High Court for violation of Coastal Regulation Zone (CRZ) norms. (ANI)