The Interpol on Thursday issued a Red Notice against fugitive offender Mehul Choksi, which means he cannot travel out of Antigua where he was last spotted since he fled India after defaulting on a hefty Punjab National bank loan. The 59-year-old had absconded in the first week of January citing medical treatment in the US, but according to reports, he had been granted citizenship in Antigua within days.
Here’s what happened
Wanted in India along with diamantaire nephew Nirav Modi for a loan fraud worth Rs. 13,000 crore, Choksi notably made headlines last month, saying he does not want to return to India for fear of being lynched. His lawyer also informed Indian investigators that Choksi was reportedly not in a condition to record his statements.
Choksi had further challenged the CBI application seeking issuance of Red Notice, describing it as a political conspiracy and further questioning the dubious jail conditions in India, his personal safety and health to the tune of another fugitive economic offender Vijay Mallya, who was ordered to be extradited by a London court last week.
Red noticed at last
According to some sources, the Interpol notice against Choksi was issued about a fortnight ago, following a meeting of the Commission for the Control of Interpol Files in October, which rejected his contentions and cleared the Red Notice.
A Red Notice “is a request to locate and provisionally arrest an individual pending extradition. It is issued by the General Secretariat at the request of a member country or an international tribunal based on a valid national arrest warrant. It is not an international arrest warrant”.
When the individual is sought for prosecution, it means they are suspected of committing a crime but have not yet been prosecuted and so should be considered innocent until proven guilty. A Red Notice serves the purpose of lending high, international visibility to such cases, limiting the fugitive’s movements, and making exchange of critical information between member countries easier.
The CBI had approached the global investigative agency on June 11 to issue a Red Notice against Modi after filing a charge sheet. In July, the Interpol had issued an Red Notice against the jewellery mogul who was last spotted in Belgium, who remains the main accused in the bank fraud cases.
The Interpol arrest warrant against Choksi similarly arrived on the basis of a request filed by the CBI. The nodal investigative agency had filed a case and started investigating the duo on January 29. The CBI along with the Enforcement Directorate (ED) drew up a separate charge sheet against Choksi in a Mumbai court, alleging that Choksi swindled Rs 7,080.86 crore, making it the country’s biggest banking scam at over Rs 13,000 crore. Nirav Modi allegedly siphoned Rs 6,000 crore.
The next step will involve authorities in Antigua tracing him and informing the Indian government, who will try to have him extradited based on a legal provision in the Antiguan constitution, which ruled for extradition of a fugitive to a designated Commonwealth country.
A brief timeline of the crimes
Modi and his business partner Choksi are wanted in India by several investigating agencies after they colluded to default crores in loans from overseas banks. They availed this enormous credit on the basis of fake guarantees in the form of fraudulent Letters of Undertaking (LoUs) in the name of PNB, India’s second largest public sector bank.
An LoU is a guarantee given by an issuing bank to Indian banks having branches abroad to grant short-term credit to the applicant.
PNB disclosed on February 14 that it was the victim of the country’s largest bank fraud; preliminary investigations showed two officials of the bank had fraudulently issued LoUs to the said firms without following the due process. These fraudulent LoUs were then transmitted across the SWIFT messaging system, based on which credit was offered to the said firms.
The Nirav Modi Global Diamond Jewellery House, started in 2010, boasts of 14 stores around the world including Mumbai, Hong Kong, London, Macau and New York. Ever since his first appearance on the Forbes billionaire list, Modi has been under the radar of law enforcement agencies, including the CBI, Enforcement Directorate (ED), and the tax department for alleged illegal transactions and frauds, for siphoning and laundering money through Dubai shell accounts, personal loans and gifts. Despite being red cornered, it has hardly affected Modi’s business ventures, which he carried out through these shell companies allegedly floated by his father and associates.
Prarthana Mitra is a staff writer at Qrius.