Billionaire Nirav Modi’s company Firestar Diamond Inc on Monday filed for bankruptcy in the United States, citing liquidity and supply challenges, Bloomberg reported. Modi, along with his uncle Mehul Choksi, has been accused of defrauding the Punjab National Bank of nearly Rs 12,703 crore.
Firestar Diamond has listed up to $100 million in assets and debt, according to the documents that the company filed in a bankruptcy court in New York. The bankruptcy filing includes Firestar’s affiliates – A Jaffe wedding jewellery and Fantasy Inc. Firestar Diamond has no links to the complaints filed by the Punjab National Bank, the company had earlier claimed.
Shares of the Punjab National Bank fell over 12% on Tuesday, a day after it revealed that the fraudulent transactions at the bank could be Rs 1,300 crore more than the current estimate of Rs 11, 380 crore. The bank It has alleged that Modi and Choksi cheated it by acquiring fraudulent Letters of Undertaking from one of its branches in Mumbai for overseas credit from other Indian lenders.
Modi and Choksi are currently abroad and have reportedly not appeared before the Enforcement Directorate despite being summoned. They claimed they could not return because their passports have been revoked.
CBI questions former PNB official, ICICI executive director
Meanwhile, the Central Bureau of Investigation on Tuesday said it had questioned former Punjab National Bank Managing Director Usha Anant Subramanian in connection with the case. ICICI Bank Executive Director NS Kanan was also questioned, as the bank was the leader of a consortium of banks that had sent money to Choksi’s Gitanjali Group, PTI quoted an unidentified CBI official as saying.
Several general managers of Punjab National Bank and statutory auditors have so far been questioned in the case.
ED granted permission to seek help from 6 countries
The Enforcement Directorate on Monday obtained permission from a special court in Mumbai to issue six Letters Rogatory – judicial requests for obtaining information from overseas locations. The letters will be sent to Hong Kong, Singapore, the United States, the United Arab Emirates, the United Kingdom and South Africa, to obtain details of the overseas financial holdings of Modi and Choksi, PTI reported.
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