Mumbai: The Enforcement Directorate (ED), which is investigating the multi-crore Punjab National Bank (PNB) loan fraud case, has found that at least 80 per cent (Rs 6498.20 crore) of the total defrauded amount of over Rs 12,400 crore from the bank, was used to settle their existing credit liabilities. “The amount was to the tune of Rs 5,064 crore. The remaining Rs1,448 crore was used to pay 17 other overseas firms,” officials said.
Close confidante of Nirav Modi, Shyam Wadhwa, who is also vice-president of the Modi group told the investigators that there are at least 30 overseas companies of Modi that trade in diamonds. Wadhwa, who was hired and posted in the back office of Next Diamonds in USA till 2008, however rose through the ranks dramatically from 2009 to become VP in the group.
The Rs 6498.20 crore was procured fraudulently by getting 150 Letter of Undertakings (LoUs) issued towards Modi’s firms Ms Diamonds R Us, Ms Solar Exports and Ms Stellar Dimonds between February and May, 2017. “The credit liabilities were towards the buyers that was availed earlier from other Indian banks’ overseas branches. Whereas Rs 1,448 was diverted between February and May last year to the 17 overseas companies that include M/s Auragem Company Ltd and M/s Sino Traders Ltd both based in Hong Kong,” said an ED officer.
Wadhwa joined the group as general manager (accounts) in 2005 and was attached with Ms Fire Stone International Pvt Ltd. During his questioning, Wadhwa told the ED that Modi floated Firestar Diamonds, Firestar Jewellery and Firestar Holdings in Hong Kong in 2009-2010. Investments into the overseas subsidiaries are made via Firestar Holdings.
The ED conducted searches at Wadhwa’s residence on Tuesday and seized documents of funds transfer from Dubai to Hong Kong.
