Nirav Modi Invested PNB Scam Funds in US Firm He Bought in 2010

Fugitive diamantaire Nirav Modi had purchased one of America’s oldest jewellery companies — Bailey Bank & Biddle — in 2010 and invested around Rs 327 crore of the money from the Punjab National Bank fraud into the company, says the supplementary charge sheet filed by Enforcement Directorate (ED).

ED officials said Nirav purchased Bailey Bank & Biddle through a shell company and his brother Nehal was made one of the directors in the jewellery retailer. They said all the instructions related to the running of the company were issued by Nirav himself. ED submitted related details to the court as part of the charges heet and attached statement of an expert who carried out due diligence and helped Nirav in the purchase. ED also attached email communication on transfer of funds between Nirav and his aides from a ‘secret server’.

The firm’s website says that it was founded in 1832. “On September 10, 1832, Bailey & Kitchen, the name of Bailey, Banks & Biddle at the time, was founded by Joseph Trowbridge Bailey and Andrew Kitchen in Philadelphia. This founding date makes us the oldest nation-wide jeweler in America,’’ it says.

The website says that Bailey & Co was commissioned to create a mortuary medal after President Abraham Lincoln was assassinated on April 14, 1865. In 1878, Bailey and Co changed its name to Bailey Banks & Biddle.

Officials said that they are yet to trace the money source that Nirav used to purchase the company but unearthed investment of $47 million (Rs 327 crore) into it which is layered through a series of transactions. ED officials examined bank statements of several shell companies in Barbados, Dubai and Hong Kong and traced the flow of funds into several accounts. The total attachment and seizure of movable and immovable properties in the case are to the tune of Rs 2,362 crore, ED said.

UK sought intel on Nirav only in June: ED

The ED has denied reports that UK Serious Fraud Office (SFO) had communicated to Indian authorities about Nirav Modi’s presence in the country in March last year and said the extradition request was sent by the agency only in July after filing of a chargesheet against him. The Interpol had issued a red notice against Nirav around that time.

“In June, the National Central Bureau of UK, which is the nodal agency for matters relating to Red Corner Notice, had asked ED to provide them with intelligence suggesting that Nirav Modi is in UK,” the agency said.

No such formal or informal communication was received by ED from UK authorities in March, 2018 or later, the officer added. The consistent stand of the UK government regarding execution of arrest warrant is that it can be done only through an extradition request for which filing of chargesheet is mandatory. The extradition request cannot be sent at the stage of investigation.

Courtesy: Economic Times