UNITED KINGDOM. London: Wanted diamond merchant, Nirav Modi, lost his legal battle against extradition, as a U.K. judge ruled this morning that “he does have a case to answer before Indian courts.”
He appeared in Westminster Magistrates’ Court today, via video link from Wandsworth Prison, in south-west London.
Mr Modi had contested his extradition to India on charges of fraud and money laundering in the estimated $2billion (around £1.4billion) Punjab National Bank (PNB) case.
The 49-year-old was arrested on an extradition warrant in March 2019 and has already appeared for a series of court hearings in the nearly two-year-long extradition battle.
His defence team, led by barrister Clare Montgomery, had attempted repeatedly to seek bail, but the attempts had been turned down both at the Magistrates’ and High Court level.
Nirav Modi is the subject of two sets of criminal proceedings: the Central Bureau of Investigation (CBI) case, related to a fraud at the expenses of the PNB through the fraudulent obtaining of letters of undertaking (LoUs) or loan agreements; and the Enforcement Directorate (ED) case, related to the laundering of the proceeds of that fraud.
The charges against him are related to “his firms Diamond R Us, Solar Exports and Stellar making fraudulent use of a credit facility offered by PNB or LoUs”, NDTV reports.
He also faces two additional charges of “causing the disappearance of evidence” and “criminal intimidation to cause death.”
Some PNB staff conspired with Nirav Modi
The Crown Prosecution Service (CPS), arguing on behalf of the Indian authorities, has told the court, in two separate hearings, that some PNB staff conspired with Nirav Modi to ensure the LoUs were issued to his company without proceeding with the required credit check, without recording the issuance of the LoUs and without charging the commission on the transactions.
CPS barrister, Helen Malcolm, has argued that the jeweller presided over a “ponzi-like scheme where new LoUs were used to repay old ones.”
A ponzi scheme “refers to an investment scam which generates funds for earlier investors with money taken from later investors and the CPS has claimed that Modi used his firms- Diamond R Us, Solar Exports and Stellar Diamonds- to make fraudulent use of PNB’s LoUs in a conspiracy with banking officials.” Indian publication Jagran English reports.
Modi’s defiance team has claimed that the issue is a commercial dispute involving “authorised through ill-advised lending” that took place in “broad daylight”.
The defence has also relied on arguments around Nirav Mondi’s mental health, as someone who has a family history of depression and suicide.
The CPS has challenged the defensive stance and called for an independent evaluation of medical records, Times of India reports.
The Indian government has also submitted an updated video recording of the cell at Barrack 12 in Arthur Road Jail in Mumbai, where Nirav Modi would be held, to prove that the cell meets all human rights requirements of natural light and ventilation.
The ruling will be sent to the U.K. home secretary
The magistrates’ court ruling will be sent back to U.K. home secretary Priti Patel for sign off, with the possibility of appeals in the High Court by Nirav Modi’s legal team.