Nehal Deepak Modi, the younger brother of the fugitive diamond trader Nirav Modi, has been arrested in the United States after India police authorities filed an extradition request.
A Belgian national, Nehal Modi was detained on July 4 by U.S. officials following a Red Corner Notice given by Interpol on request from India's Central Bureau of Investigation (CBI) and Enforcement Directorate (ED).
His arrest is the culmination of a long diplomatic and legal exercise. While Nehal had challenged the authenticity of the Red Corner Notice, his bid to get it rescinded failed.
Indian authorities have connected Nehal Modi to the scandalous Punjab National Bank (PNB) scam—one of India's biggest banking frauds, which was discovered in early 2018. Although Nirav Modi is the main accused, officials assert Nehal played a key role in helping his brother once the scam was discovered. He reportedly facilitated eliminating crucial evidence, manipulating witnesses, and disrupting probe activities.
Apart from that, Nehal Modi is accused of assisting in the money laundering of illegal money—several thousand crores of rupees—earned through the fraud. He is suspected by the authorities to have operated these activities through a chain of offshore shell firms and cross-border transactions.
The case is now likely to proceed in the U.S. legal system, and the next hearing is scheduled to be held on July 17. A bail petition is likely to be filed on behalf of Nehal, but American prosecutors have already indicated that they will oppose any request for his release.
The PNB scam, which was estimated at more than ₹13,500 crore (about USD 2 billion), hit the Indian banking industry hard. Indian agencies alleged that Nirav Modi allegedly siphoned off ₹6,498.20 crore, and his uncle Mehul Choksi is said to have siphoned off ₹7,080.86 crore.
Both the men escaped the country in January 2018, days before PNB informed the authorities about the scam. Nirav Modi was arrested in the UK in March 2019 and is now being held in a London jail, fighting extradition to India. Mehul Choksi, on the other hand, is living in Antigua, where he is also facing legal battles pertaining to his citizenship.
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