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PNB Fraud : Nirav Modi’s company files for bankruptcy in USA

Estranged millionaire jeweller Nirav Modi’s company Firestar Diamond Inc. has applied for bankruptcy protection in the United States after Indian investigation agencies have been mounting pressure on it for being involved in the massive Punjab National Bank (PNB) fraud case.

The company has pegged its assets and liabilities in the range of $50 million to $100 million, and numbered its creditors between 50 to 99, in its bankruptcy application before a court based in the Southern District of New York.

Back in India, the government has stepped up its crackdown efforts on Modi’s and his uncle Mehul Choksi’s companies through CBI and Enforcement Directorate. Just last week, investigative agencies raided an office of one of India’s biggest law firms to examine and seize documents in relation with its former client, Nirav Modi.

All these events took place just days after PNB claimed that the extent of fraudulent transactions undertaken by Modi in collusion with some bank officials could increase by $206 million to touch as much as $2 billion. The bank’s share prices reached a 20-month law when this declaration was made.

CBI has taken stern action against Nirav Modi and Mehul Choksi by attaching many of their assets and issuing non-bailable arrest warrants in their name. Both the accused persons are currently situated abroad and have claimed innocence in response to charges against them.

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