Who is Nehal Modi and why was he arrested in the US? Know here

Nehal Modi has been arrested in the United States following an extradition request made by the Central Bureau of Investigation (CBI) and the Enforcement Directorate (ED) in connection with the Punjab National Bank (PNB) fraud case worth ₹13,000, PTI reported citing officials.

Who is Nehal Modi?

Nehal Modi, 46 is the younger brother of fugitive diamond merchant Nirav Modi. Nehal Modi, born and raised in Antwerp, Belgium, and fluent in English, Gujarati, and Hindi, is wanted in India for laundering criminal proceeds for Nirav Modi, who is held at London prison and facing extradition proceedings in UK upon India's request.

What is he accused of?

The US prosecutors initiated extradition proceedings based on two charges, including money laundering charges under Section 3 of the Prevention of Money Laundering Act (PMLA), 2002, and criminal conspiracy charges under Sections 120-B (criminal conspiracy) and 201 (disappearance) of the Indian Penal Code, PTI reported.

As per the ED and CBI probe, Nehal Modi played an important role in laundering the proceeds of crime on behalf of Nirav Modi. He is accused of helping in concealing and transferring large amounts of illegal funds through a network of shell companies and international transactions, violating Indian laws.

The chargesheet filed by ED stated that Nehal has been charged with destruction of evidence and “knowingly and intentionally” assisting Nirav Modi, it added.

After the PNB fraud came into light, Nehal, along with Nirav's close aide and executive Mihir R Bhansali, "took 50 kg gold and substantial cash from Dubai, and directed dummy directors not to reveal his name before the authorities," ED alleged.

What is PNB fraud case?

In 2018, PNB revealed a major fraud valued at ₹13,500 crore, which started at one Mumbai branch and involved prominent figures such as Nirav Modi and his uncle Mehul Choksi, Gitanjali Gems' managing director. Both Modi and Choksi are accused of manipulating the bank's systems to acquire fraudulent Letters of Undertaking (LoUs) with the help of some rogue bank officials, enabling them to divert large amounts of money.

What's next for Nehal Modi?

The upcoming hearing is set for July 17, where Nehal Modi might request bail, a move anticipated to be challenged by the US prosecutors, PTI reported.

Notably, this is not the first time that Nehal Modi has been accused of such a scam. In 2020, A New York court convicted Modi of fraudulently acquiring diamonds valued at over $2.6 million from LLD Diamonds USA, one of the largest diamond firms globally, according to a report by the Hindustan Times.