Indian billionaire jeweller arrested over alleged bank fraud, reports BBC

Indian businessman Mehul Choksi has been arrested in Belgium following India's request for his extradition. Mr Choksi, who left India in 2018, was arrested on Saturday, his lawyer Vijay Aggarwal told the BBC on Monday.

The diamond merchant is wanted by India over allegations of involvement in a case of defrauding one of the country’s largest banks of nearly $1.8 billion (GBP1.3 billion).

Mr Choksi has not commented publicly on the case, but his lawyer said they would appeal against his detention and also oppose his extradition to India.

“These are the obvious grounds [on which we will argue the case], that he is not a flight risk and secondly, that he is extremely sick. He is undergoing cancer treatment,” Mr Agarwal said. He added that they would “contest the extradition on grounds that there isn’t enough evidence against him and the extradition request is politically motivated and the trial in India may not be fair”.

The BBC has reached out to India’s foreign ministry and financial crimes agency -- the Enforcement Directorate (ED) -- for comment. According to a Times of India report, Mr Choksi was arrested on the basis of two non-bailable warrants issued by an Indian court in 2018 and 2021 -- although it’s not clear why the action came now.

Mr Choksi and his nephew, Nirav Modi, are wanted by Indian authorities in connection with a $1.8bn fraud case at Punjab National Bank (PNB). Mr Modi, who’s also been living abroad since 2018, is lodged in a prison in London and is awaiting extradition to India. Both were high-profile diamond traders. Mr Modi’s jewellery was worn by several Hollywood celebrities such as Naomi Watts and Kate Winslet. One of the biggest Bollywood stars, Priyanka Chopra, was his company’s brand ambassador.

Mr Choksi, meanwhile, was the owner of Gitanjali Gems, an Indian jewellery retailer which once had about 4,000 stores across India.

The ED has accused Mr Choksi and Modi of colluding with some employees of PNB’s Brady House branch in Mumbai city to get fraudulent advances for payments to overseas suppliers of jewels. These funds were then allegedly diverted and laundered. Mr Choksi and Mr Modi have denied the allegations against them. After leaving India, Mr Choksi reportedly travelled to the US and later to Antigua - where he has citizenship. In 2021, he was reportedly arrested in Dominica and deported back to Antigua.

Hariprasad SV, a Bengaluru-based entrepreneur who had in 2016 alerted authorities about the alleged scam at PNB, said Mr Choksi’s arrest was “great news”. “Apart from bringing him back, the most important thing is to get back all those billions of dollars he looted from India,” he told ANI news agency.