Jeweller to stars fights extradition from Britain over ‘£1.5bn gems con’
A BILLIONAIRE diamond dealer favoured by celebrities is fighting extradition to India over allegations of a £1.5billion swindle.
Nirav Modi’s jewellery has been worn by Kate Winslet and Rosie Huntington-Whiteley.
But he used cheap glued-on gems to con lenders, a court heard yesterday.
Modi fled India after allegedly taking part in the country’s biggest swindle against the state-run Punjab National Bank (PNB).
One of India’s richest men, Modi was arrested in March last year in London after a Metro Bank worker identified him as an alleged fugitive when he tried to open an account.
The 49-year-old tycoon was remanded in custody.
Modi has denied any wrongdoing. He has been fighting extradition to India for 14 months.
He appeared via video-link from prison yesterday at Westminster magistrates court in the first of five hearings which will decide his fate.
Helen Malcolm, QC, for the Indian government, said the alleged fraudster would buy low-grade diamonds and glue them on to jewellery as part of an international money laundering scheme. He allegedly circulated the gems among several dummy companies within the Modi empire across Hong Kong and the US. The companies were used as a front to siphon off loans from PNB under the pretence of selling pearls and gold to outside buyers, the court heard.
Ms Malcolm said: “No one can make a profit if all you ever do is create jewellery in India, export to Hong Kong, melt down, reconstitute to India, export and so on round and round and round, because if you’re going to make a profit you have to make sales at some point to outside customers.
“What is important is these were dummy Modi companies… used for siphoning off the money that came from the PNB from the fraudulent MOUs [loan agreements].
“The diamonds were merely circulated – and the same is true for pearls – in order to, and I quote, ‘manipulate the audit report’.”
Modi allegedly splashed out on an upmarket property by Central Park, New York, for his wife and children with money from the public sector bank.
When he left India last year investigators seized more than half a dozen luxury cars, including a Rolls-Royce Ghost and a Porsche Panamera. The extradition hearing continues.