Westminster Court, United Kingdom: A provisional arrest warrant has been issued against the fugitive diamond merchant, Nirav Modi for his extradition in a money laundering case.
He is the main accused in the Punjab National Bank scam case.
The Westminster Court has issued the arrest warrant against Nirav Modi as part of processing this extradition request. The warrant is provisional, and he is entitled to obtain bail.
Background of the scam:
As reported by Hindustan Times, Two PNB employees sent unauthorised letters of undertakings (LoUs), essentially bank guarantees, to foreign branches of Indian lenders, on behalf of firms related to Nirav Modi and the Gitanjali Group. The LoUs basically told these other lenders: Lend money to Nirav Modi firms so that they can pay for their imports. If they don’t pay up, we will make good this payment.
In the PNB fraud case, the bank employees had sent these guarantees in the absence of credit limits and collateral security (in Modi’s case). Secondly, they didn’t make an entry in the bank’s core banking system – the software used to support a bank’s most common transactions, which also acts as a record keeper.
Reported by Media