In what could spell more trouble for businessman Nirav Modi, Bank of India has filed a lawsuit against fraudster Nirav Modi in a Hong Kong court for the recovery of debt to the tune of $6.25 million.
Nirav Modi got the money from the bank of India, after acquiring Letters of Undertaking (LoUs) via illegal means. Bank of India has become the second bank to file a recovery lawsuit in the Hong Kong court. Earlier, Punjab National Bank (PNB) moved to Hong Kong Court for the recovery.
Bank of India had filed the lawsuit after th eprobe authorities confirmed that Nirav Modi is hiding in Hong Kong.
Meanwhile, a US bankruptcy court-appointed examiner has begun the much-awaited investigation into the over $2-billion fraud involving now fugitive diamantaire Nirav Modi and some employees of Punjab National Bank (PNB).
The examiner, John J Carney, and his counsel have already held telephonic meetings with counsel for Modi-owned Firestar Diamond’s debtors– HSBC Bank USA, Israeli Discount Bank of New York, PNB– the Indian Ministry of Corporate Affairs and the Office of the United States Trustee, a court document said.
The probe findings are important because they may contain vital pieces of information on how billionaire Modi’s now bankrupt company Firestar Diamond Inc played a role in the flow of money linked to India’s largest banking fraud case. The examiner will have to determine to what extent the Modi entities have the ability to influence the actions taken by Firestar, which had filed for bankruptcy protection in America soon after the banking fraud came to light in India.
The US examiner’s preliminary discussions with the debtors reveal that they have collected one terabyte of data, roughly equals to information in 1428 CD-ROMs. The examiner expects the number of documents will approximate “tens of thousands of pages”. The probe will look into communications, books and records, bank statements, vendor information, organisational charts, agreements, jewellery valuations, banking and other financial records, internal policies and protocols, and inventory/sale/consignment documents.
The examiner estimates that the fees and expenses in connection with his investigation report will be between $1.3 million and $1.5 million, the court document said.
Upon the examiner’s request, several of the parties have agreed to voluntarily produce relevant documents and communications and have agreed to participate in informal interviews. Also, identification is on for location of the documents, crafting a document review protocol, creating search terms, and negotiating the creation of secure databases. Also, a proposed protective order has been prepared to apply to documents produced by the parties and these will be housed in a document depository.
Prasanta Patnaik