Mumbai: The enforcement directorate (ED) on Thursday filed a charge sheet against Mehul Choksi and 13 others, including five companies, in the ₹ 14,357 crore Punjab National Bank (PNB) scam.
The charge sheet traces fraudulent letters of undertaking (LoUs) of ₹ 3,011.39 crore and foreign letters of credit (FLC) of ₹ 3,086.24 crore to three companies belonging to the Choksi group of firms—Gitanjali Gems Ltd, Gili India and Nakshatra.
The charge sheet, filed in the special Prevention of Money Laundering (PMLA) court, alleges that some of the funds obtained through the LoUs and FLCs were laundered and diverted through overseas companies.
The companies where these funds were allegedly diverted are based in the US, China, Belgium, the UK, UAE, Thailand, Japan, Italy and Belgium.
This is ED’s second charge sheet in the PNB scam. The first one was filed on 24 May against jeweller Nirav Modi and 23 others.
Portions of the ED’s first charge sheet have been reviewed by Mint.
The 12,000-page first charge sheet alleges that the accused used dummy companies and directors for money laundering. “Firms were created with the purpose of acquiring properties and laundering ill-gotten money," ED alleged. There were six dummy companies floated in Hong Kong and nine in the UAE. The India-based dummy companies include Bentley Properties and Mac Business Enterprises.
The funds were rotated in the guise of export-import transactions. The charge sheet alleged that portions of ₹ 6,498 crore availed through the LoUs were diverted through dummy companies based in Hong Kong and Dubai.
“All these goods (jewellery and funds) were moved between the Firestar Group of companies and the dummy companies in countries namely Hong Kong, Dubai and India. This would create huge outstanding in the books of accounts of dummy companies against the Indian companies. The fraudulent funds were then layered against the payments of the dummy exports/imports. In the same process, the funds were diverted from Hong Kong to various other related companies/entities located in other countries," ED said in the charge sheet against Nirav Modi.
In the charge sheet, ED also outlined that these alleged dummy companies did not reflect any transactions barring the movement of funds from group companies.
“This emphasizes the fact that the companies were used only to layer the funds and to obfuscate the real source, which are the fraudulent LOUs issued from PNB," the ED charge sheet said.
On Monday, a special PMLA court in Mumbai had allowed an application filed by ED seeking Modi’s extradition from the UK. It has also sent a request for a red corner notice against Modi to Interpol.