US arrests Nirav Modi's brother Nehal in ₹13,000 crore PNB scam

Nehal Modi, brother of fugitive Nirav Modi, has been arrested in the US on India's request in connection with the ₹13,000 crore PNB bank fraud. He faces extradition on money laundering charges

US authorities have arrested Nehal Modi, the younger brother of fugitive diamond trader Nirav Modi, based on extradition requests made by India’s Enforcement Directorate (ED) and the Central Bureau of Investigation (CBI) in connection with the ₹13,000 crore Punjab National Bank (PNB) fraud.   

Nehal was taken into custody on Friday, according to a report by the Press Trust of India, quoting US officials. The next hearing in Nehal’s case is set for July 17. According to officials, Nehal may apply for bail during the hearing.   Notably, Nehal walked out of a US prison on Thursday after serving a nearly-three-year sentence in a cheating case and was taken into custody the very next day by authorities there on the request of Indian agencies.

 

The arrest is in response to a joint extradition plea filed by the ED and the CBI. US prosecutors are pursuing the extradition on two charges — one count of money laundering under Section 3 of the Prevention of Money Laundering Act (PMLA), 2002, and another for criminal conspiracy under Sections 120-B (criminal conspiracy) and 201 (causing disappearance of evidence) of the Indian Penal Code.

Multi-crore bank fraud

Nehal, 46, is accused in connection with a ₹13,000 crore bank fraud. It is said to be one of India’s biggest scams, involving the PNB.

 

 

The alleged fraud was reportedly carried out by Nirav Modi, his brother Nehal, and their uncle Mehul Choksi.

 

Born and raised in Antwerp, Belgium, Nehal is fluent in English, Gujarati, and Hindi. He is wanted in India for allegedly laundering money on behalf of his brother Nirav, who is currently in a London prison, also facing extradition to India.

 

Officials claim Nehal helped hide and move large amounts of illegal funds using shell companies and international transfers, violating India's financial laws.

Nehal named in ED chargesheet

The Enforcement Directorate has named Nehal Modi in its chargesheet in the case. He has been accused of destroying evidence and of “knowingly and intentionally” supporting Nirav Modi in carrying out illegal activities.

 

According to the ED, after the PNB scam was uncovered, Nehal, along with Nirav's trusted associate Mihir R Bhansali, “took 50 kg gold and substantial cash from Dubai, and directed dummy directors not to reveal his name before the authorities”. 

Red Notice issued by Interpol

At the request of Indian authorities, Interpol had earlier issued a Red Notice against Nehal. A Red Notice is a request to member countries to find and provisionally detain a person pending extradition or similar legal action.

 

Nehal challenged the Red Notice before the Commission for Control of Interpol's Files (CCF), but his appeal was rejected after the CBI provided a detailed rebuttal.

Allegations of evidence destruction and coercion

The CBI has also accused Nehal of threatening directors of several Dubai-based shell companies used by Nirav to create the illusion of genuine business transactions.

 

These directors were allegedly forced to shift from Dubai to Cairo, during which their phones, laptops, and servers were destroyed to eliminate digital evidence.   They were also allegedly made to sign documents falsely identifying themselves as owners of firms based in Dubai and Hong Kong. These individuals were employees of Nirav's businesses and not the actual company owners, officials told PTI.