Fugitive diamantaire Mehul Choksi’s firm in the US, Samuels Jewelers Inc, may have sold lab-grown diamonds by falsely certifying them as natural stones, an investigation ordered by a US bankruptcy court has alleged.
A laboratory “secretly” controlled by Choksi through a British Virgin Islands (BVI) firm was being used to manufacture the diamonds, The Indian Express reported.
The forensic report from the investigation also alleged that the US firm, owned by Gitanjali Gems Ltd, had received about $20 million (Rs 139 crore) from the fraudulent Letters of Undertaking (LoUs) issued to Gitanjali by Punjab National Bank (PNB) in India.
This money, the report adds, was received through a “sham royalty agreement” between Samuels Jewelers and firms controlled by Choksi.
A former senior employee of the firm had previously alleged that the company would falsify the quality of its diamonds and sell them at exorbitant rates, as per a Moneycontrol report.
“The diamonds were sold at a premium in the name of brand value, cuts and certifications that were given out. The certifications too were forged. A diamond that claimed to be of Grade A in a purchase made was actually Grade C,” the company’s former managing director Santosh Srivastava had said last year.
“The diamonds that were passed as precious and rare and were actually lab produced coasted only 5-10 percent of the cost it was sold at,” he said.
Choksi, his nephew Nirav Modi, several of their family members, employees and retired or serving top PNB executives and officials are accused in the $2 billion PNB scam.
They are accused of colluding with a handful of bankers to secure credit from overseas banks using fraudulent guarantees.
(With inputs from PTI, The Indian Express and Moneycontrol)
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