UK court denies bail to Indian billionaire suspected of bank fraud

A Congress Party supporter puts his hand on an image of Nirav Modi during a protest in New Delhi.
A Congress Party supporter puts his hand on an image of Nirav Modi during a protest in New Delhi.PHOTO: AFP

LONDON • Fugitive billionaire jeweller Nirav Modi has been denied bail in a London court, following his arrest two weeks ago on charges over his alleged involvement in a US$2 billion (S$2.7 billion) fraud at India's state-run Punjab National Bank (PNB).

The 48-year-old, who denies the charges, faces possible extradition to India where Prime Minister Narendra Modi is under pressure to take a firm stance on the case ahead of national elections in April and May.

The two Modis are not related.

"There are substantial grounds to fear failure to surrender," magistrate Emma Arbuthnot told a Westminster court last Friday, adding that Modi's application for a visa to the Pacific Island nation of Vanuatu in 2017 exacerbated those concerns.

A witness has alleged that Modi threatened to kill him and had also offered him around 2 million rupees (S$39,000) as a bribe to give false testimony, Mr Toby Cadman, a lawyer representing the Indian government, told the court.

The prosecution also alleges that mobile phones and a server containing evidence critical to the fraud case have been destroyed at the request of Modi, Mr Cadman said.

Ms Clare Montgomery, a lawyer representing Modi, said there was no evidence to support the claims of witness intimidation.


Modi, whose diamonds have adorned Hollywood stars such as Kate Winslet and Dakota Johnson, is among those accused in India's biggest banking fraud, which has shaken confidence in the country's state banking sector.

He was arrested in the Holborn area of central London on March 19, after he went into a bank to open an account and an employee contacted the police.

Modi was not a fugitive, was leasing a property in London under his own name and had made arrangements to surrender voluntarily on March 25, Ms Montgomery told the court.

PNB executives and government investigators have said that a lone middle-aged manager, later aided by a young subordinate, engineered fraudulent transactions totalling about US$1.8 billion from 2011 to 2017. PNB, India's second-largest state-run bank, said last year that two jewellery groups headed by Modi and his uncle Mehul Choksi had defrauded it by raising credit from other Indian banks using fraudulent guarantees issued by the PNB rogue staff. Choksi has also denied wrongdoing.

Modi's next scheduled appearance before the court is via video link on April 26.


A version of this article appeared in the print edition of The Sunday Times on March 31, 2019, with the headline 'UK court denies bail to Indian billionaire suspected of bank fraud'. Print Edition | Subscribe