Nirav Modi Case: CBI, SEBI & PMO Were Apprised of the Scam in 2016

Whistleblower Hari Prasad says none of the investigating agencies acted on his complaint filed in 2016.

Nirav Modi is the main accused in an alleged fraud of Rs 11,300 crore involving Punjab National Bank.

(Photo Courtesy: Facebook)

There has been a fair bit of chatter on social media over when the first complaint against Nirav Modi – the prime accused in the Rs 11,400 crore bank fraud scam – was filed, and whether he was allowed to flee the country after the complaint was filed by the Punjab National Bank (PNB).

To put the record straight, there are five complaints in total, filed by whistleblower and businessman, Hari Prasad, and PNB.

The first complaint was filed to the CBI, Enforcement Directorate (ED) and SEBI by Hari Prasad SV, a businessman from Karnataka in 2016. The complaint was against the fraudulent transactions of Nirav Modi’s uncle, Mehul C Choksi and his company M/s Gitanjali Gems Limited.

When Prasad saw that no action was taken by the agency sleuths, he filed the same complaint at the Prime Minister’s Office (PMO) in July 2016. The PMO escalated the complaint to the Registrar of Companies (ROC) for action.

When The Quint spoke to Hari Prasad, he said:

No one ever contacted me from any investigating agency. I only received an email from the ROC that my matter has been closed after due investigation.

On the other hand, CBI sources say:

We cannot conclusively say whether the PMO forwarded the complaint against Choksi to the CBI or not, or whether the agency directly received any complaint from Hari Prasad.

The second complaint was filed by the PNB against Nirav Modi and his company on 29 January 2018, on the basis of which the CBI registered a case of Rs 280 crores under the Prevention of Corruption Act on 31 January 2018.

The third and the fourth complaint against Modi and his company were sent to CBI by PNB on 13 February 2018. The agency is still examining the complaints.

Did CBI Allow Modi to Flee the Country?

According to the CBI, Modi and his uncle Choksi left the country on 1 January and the agency received a complaint against the former on 29 January 2018. Hence, the agency claims it is not possible that the CBI let Modi run from the country. As of now, the agency is not accepting that they received any complaint from Hari Prasad.

Moreover, the CBI issued a Look Out Circular (LOC) against Modi, his wife Ami, his uncle Choksi, and his brother Nishal Modi.

Mehul Choksi, Chairman, Gitanjali group(Photo Courtesy: Gitanjali)

What the 2016 Complaint to the PMO Entails

In the complaint filed to the PMO, Hari Prasad mentioned Modi’s uncle solely. He questioned Choksi’s fraudulent activities and produced documents as evidence to support his argument.

Here are the key points from Prasad’s complaint:

• Prasad said that Choksi and his company, Gitanjali Gems Limited, are involved in siphoning thousands of crores of money through various subsidiary companies floated in India to fictitious companies abroad.
• Prasad attached several grievance letters from various franchisees of Choksi’s company as supporting documents.
• Choksi’s company had taken huge loans to the tune of almost Rs 9,872 crore with meagre assets of just Rs 25-30 crore, said Prasad. The complaint also mentioned 31 banks that extended loans to Choksi’s company.
• Choksi’s company had not allegedly paid tax dues to the IT department since 2006.
• Prasad also mentioned some criminal cases which were filed against Choksi and his company in Bengaluru in 2015.

Prasad also specified in his complaint that he urged the PMO to look into the matter urgently before the accused could flee from the country like Vijay Mallya of Kingfisher group.

A franchisee of Gitanjali Gems Limited, Prasad faced a loss to the tune of Rs 13 crore. Later, he found that there were others duped by the company as well. Prasad filed a complaint with the Bengaluru police too, which is now being investigated by the CID.