Nirav Modi, who allegedly defrauded Indian state-run Punjab National Bank (PNB) of $2 billion, was arrested and denied bail by a London judge who said there were "substantial risks" that the celebrity jeweler could flee while the country seeks his extradition. Modi was arrested in central London on Tuesday evening on behalf of Indian authorities who want to extradite him to face charges.
UK newspaper The Telegraph found India's most wanted man, Nirav Modi, openly walking the streets of London, allegedly living in an £8 million ($10.4 million) apartment in London’s West End and apparetly running another diamond business. Nirav Modi fled India last year after becoming a suspect in the biggest banking fraud in the country’s history. A diamond jeweller whose designs have been worn by Hollywood stars, Modi went on the run after being accused of defrauding the Punjab National Bank of roughly $2 billion.
The Gemological Institute of America (GIA) last week published an article on a most curious discovery: "One Natural Melee Diamond Found in Large Batch of HPHT Synthetic Melee".
India has been informed by the UK's Crown Prosecution Service (CPS) that it can initiate extradition proceedings against Indian diamantaire Nirav Modi even though his exact whereabouts remain uncertain, a senior Indian official said today. According to Indian daily The Times of India, the Central Bureau of Investigation (CBI) has begun the process of filing an extradition request for Modi, which will then have to be approved by the UK Home Office following which an extradition warrant can be issued.
After the $2 billion worth of fraud allegations against Indian jewelry tycoon Nirav Modi and Gitanjali Gems chief Mehul Choksi shocked the Indian diamond industry, the last thing it needed was more bad news, which is precisely what they got. Jewelry chain Kanishk Gold, which also owns the Krizz jewelry brand, has been named in defrauding 14 banks, including the Punjab National Bank (PNB) and the State Bank of India (SBI), for an amount close to as $126.4 million, or Rs 824 crore. Taking into account interest due, the loss to banks exceeds $153 million (Rs 1,000 crore). The SBI has sought th
Diamonds and other precious stones forming part of a Czech National Museum collection in Prague, assumed to be worth millions of dollars, were discovered during a routine audit to be fakes and synthetics. The cheap imitations include a 5-carat diamond, which is just a piece of glass, and a 19-carat sapphire which turned out to be synthetic. As told by Radio Praha, "The major reconstruction of the headquarters of the National Museum in Prague has revealed more than just peeling paint and cracks in the walls.
A US court last Thursday passed an interim order that prevents creditors from collecting debt from Nirav Modi-owned Firestar Diamond Inc (FDI) and its affiliates after it filed for bankruptcy. Modi, who is being investigated for illegal transfer of nearly $2 billion from Punjab National Bank, has a majority stake in Firestar Diamond and its other sister companies through his other companies. FDI filed the Chapter 11 voluntary petition in the New York Southern Bankruptcy Court last week, and the bankruptcy court said that the filing of case imposed an automatic stay against most collection a
With the country’s leading public sector banks facing massive financial turmoil following the fraud cases featuring billionaire Nirav Modi and Mehul Choksi, now estimated to involve approximately $2 billion, diamond mining companies may ultimately pay the price as far as sale of rough diamonds to Indian diamond companies is concerned, suggests The Times of India. The TOI turned to independent diamond analyst Paul Zimnisky for insight: “There are two primary concerns as a result of the Modi and Choksi episode.
Firestar Diamond, a company owned by Nirav Modi, the billionaire jeweller at the heart of a $2 billion fraud case in India, has filed for bankruptcy in a New York court, as investigators stepped up their investigation into a case that has stunned the country of India. Firestar Diamond, which on its website states that its operations span the US, Europe, the Middle East, the Far East and India, blamed liquidity and supply chain challenges. It listed up to $100 million in assets and debt, the court document said.
On Saturday, February 17, 2018, India's Gem & Jewellery Export Promotion Council (GJEPC) released a statement on the incidents that have recently come to light with regards to the alleged fraud committed by two members of the Council. They state: "The Nirav Modi/Gitanjali Gems incident is of concern to the entire Gems & Jewellery industry. The Industry strongly condemns any sort of unlawful & illegal actions by any individual, trade or otherwise.
The Nirav Modi bank fraud investigation in India appears to have spread its wings, as three more major Indian jewelers - Gitanjali, Ginni and Nakshatra - have also come under the gaze of various investigating agencies following the Punjab National Bank's (PNB) declaration of nearly $1.8 billion (Rs 11,400 crore) fraud, committed allegedly by Nirav Modi.
Indian federal agents launched an investigation into billionaire jeweller Nirav Modi, one of the country’s richest men, over accusations that he and others defrauded a state bank of $44 million.
The latest fraudulent twist on the synthetic diamond landscape has profound implications for the efforts to keep natural and synthetic diamonds separate, if the incident in question is not an isolated one. The Gemological Institute of America (GIA) recently recieved a round brilliant cut diamond (image, left) submitted for an updated diamond grading report. Its girdle was inscribed with an actual GIA report number (image, right), identifying the stone as a natural, untreated diamond. After testing, however, it turned out that the newly submitted diamond was an HPHT-grown synthetic diamond.
In November 2016, Reuters reported that an Italian market regulator Consob was investigating the sale of high-quality investment diamonds through bank branches across the country after a TV report alleged the stones were mis-sold to the public. Several Italian banks distribute diamonds for diamond brokers, generating around 300 million euros ($334 million) in sales for the brokers last year.
The Gemological Institute of America (GIA) has made an alarming discovery, namely, a natural white diamond covered by a thin (80 microns, or 0.003 inches) synthetic layer that colors it blue – and has warned that more such composites might be on the market. The 0.33-carat stone is a composite of CVD synthetic Type IIb diamond overgrowth on a natural Type Ia diamond.
Twelve suspected Russian gangsters stole $9-10 million in diamonds from wholesalers in Midtown’s Diamond District, federal prosecutors said Wednesday. A long-running investigation into international diamond fraud led to the arrest of ten (or nine, depending on source) Russians who allegedly cost their victims nearly $10 million, reports several U.S. news outlets. The scam victimized diamond dealers in New York City, Las Vegas and Mumbai.
The U.S. Department of Justice, through its District of Minnesota U.S. Attorney's Office, has announced a federal indictment charging former Scio Diamond Technology Corporation (Scio Diamond) Board of Directors Chairman, Edward S. Adams, with "orchestrating an elaborate fraud scheme to embezzle millions of dollars of investors' funds." The indictment alleges the activity happened between 2006 and 2013. Adams was indicted Wednesday in U.S.
Avi Krawitz of Rapaport News sat down with Joseph Kuzi, CEO of EGL Asia and director of Diamond Services, a Hong-Kong based synthetics testing facility, to talk about the phenomenon of undisclosed synthetic diamonds. He heard that the technology behind and production of synthetic diamonds is increasing rapidly, and just because we do not hear about every instance where undisclosed mixing of synthetic and natural diamonds is discovered, does not mean it is not widespread.
Israeli authorities have placed Israeli diamond and mining mogul Beny Steinmetz under house arrest over allegations of bribery and corruption in Guinea linked to his BSG Resources (BGSR) mining company. One of Israel’s wealthiest men, Steinmetz has been arrested in Israel over claims that he paid millions of dollars in bribes to secure mineral assets in one of the world’s poorest nations.
According to a report on the Israeli news site Hamodia, the country's tax authorities, following Israels commitments to the US and international organizations to apply a more stringent anti-money laundering policy, are targeting the Israeli diamond industry, generally considered the biggest offenders in this domain. Officials said that as of January 1st, the administration will go after tax fraud more agressively, implementing extended powers of investigation and enforcement.
The United States Supreme Court became the seventh separate court to agree with PJSC LUKOIL (Grib Diamonds is a 100% owned subsidiary of LUKOIL) that Archangel Diamond Corporation (ADC) Liquidation Trust’s case against LUKOIL could not be pursued in the United States. By this decision the Supreme Court has put an end to ADC’s pursuit of any further litigation in the United States. The verdict of November 7, 2016 is final and non-appealable. The case was initially filed in November 2001 in Colorado State Court.
Last week's surprise announcement that the Indian government was imposing a ban on denominations of Rs 500 and Rs 1000 notes has already has already started to unleash a profound impact on the diamond industry and beyond. On the one hand, industry insiders are saying that payments in Surat would come grinding to a halt for at least the next two to three months owing to paucity of cash funds, and defaults as such would rise.
India’s Prime Minister Modi today announced that the existing 500 and 1,000 rupee notes, the highest denomination notes in the country, will be taken out of circulation in 24 hours, to be replaced by new notes of the same denomination. The current notes will no longer be valid as of tomorrow, November 9. The bold measure is intended to combat counterfeiting, (tax) fraud and corruption by making the so-called “black money” visible. The abolished notes can be exchanged at banks until December 30.
In his latest Diamond Intelligence Briefing, "A Fraud in Progress... A Criminal Conspiracy to Default Hits Indian Exporters", industry insider Chaim Even-Zohar unravels a massive case of fraud perpetrated by a rogue diamond broker and US-based buyers against Indian diamond suppliers, currently estimated at $35-50 million.
By Chaim Even-Zohar. Reprinted from Diamond Intelligence Briefs by special arrangement. Click here to read the first article.
In the lastest installment of the Diamond Intelligence Briefing (DIB), diamond industry analyst Chaim Even-Zohar presents a searing indictiment of the rough diamond trade in the United States, "The world's most convenient and 'uncontrolled' rough transfer market", claiming that, "The main justification for the overwhelming bulk of the (U.S.) rough trade is pure transfer pricing*." This rough diamond 'stopover' in the U.S. also "endangers the integrity of the legitimate U.S.
Rapaport Auctions and Trading issued a press release today offering clients, "the opportunity to purchase parcels of melee that are 100% natural and untreated," and their timing could not be more appropriate. On July 18, Morgan Stanley released a report on the effect of synthetic diamonds on mined diamonds, which says that the share of synthetics is so far negligible, but not for long.
The vast majority of the diamond bankruptcies of late, however, have NOT been a result of business miscalculations, market downturns, or bad timing. They have all been planned, well-orchestrated moves to intentionally defraud other diamond industry stakeholders, particularly banks, of large sums of money. Many of these people - particularly in India - have been declared wilful defaulters by the banks and the authorities. And we’re all braced for many more.
The system at the Israeli Diamond Exchange in Ramat Gan is built on trust, yet the arrest of veteran diamantaire Hanan Abramovich triggering an investigation into accusations that he defrauded fellow traders of $65m worth of money and stones, writes Financial Times, threatens to have a direct effect on traders who have allegedly lost out.
Following a series of defaults that rocked the industry since January 2016, involving amount to the tune of over $60mn by parties in Mumbai and Surat, the Surat Diamond Association (SDA) has urged diamond traders and manufacturers in Surat to implement 'know your customer (KYC)' norms before dealing in precious diamonds with anyone, reported the Times of India.
According to Tel Aviv Magistrates Court Judge Ronit Poznanski-Katz, suspicions are hardening against diamond dealer Hanan Abramovich, suspected of forgery and fraud totaling $60 million, and the judge extended Abramovich's remand for the fifth time, this time by four days. "The array of documents submitted to the Court and a confidential report filed by the police put the reasonable suspicion concerning the crimes attributed to the suspect, which include other crimes besides fraud (including forgery and money laundering) on a firmer basis." Also released for the first time was the name of o
The Kimberley Process has sent an announcement warning its members of yet another fake KP certificate from Sierra Leone, the second in two weeks. The Focal Point of the United Arab Emirates reports that the UAE KP Office was contacted by a client prior to the import of a shipment to check the authenticity of a scanned copy of a KP Certificate from Sierra Leone. The UAE KP Office contacted Sierra Leone who confirmed via email that the attached copy is a false certificate.
A copy of the fake certificate is in annex.
The Antwerp World Diamond Centre has forwarded an alert from Kimberley Process authorities about a fake KP certificate issued from Sierra Leone. The warning reads:
Reports from multiple sources are starting to detail the murky structures hiding the tremendous wealth accumulated by certain players in the diamond and gold trade that emerged through last week's release of the Panama Papers.
The Panama Papers is an unprecedented investigation that reveals the offshore links of some of the globe’s most prominent figures, writes African Network of Centers for Investigative Reporting (ANCIR).
The United Arab Emirates received a shipment from Cameroon, which was declared to the UAE Customs. Upon inspection they noticed that the KP Certificate accompanying the shipment was fake. Cameroon authorities confirmed this. The document was uploaded on the restricted side of the KP website as well. The KP has therefore called on all its members to be vigilant regarding shipments of rough diamonds accompanied by a Cameroon KP certificate.
In the summer of 2013, India-based diamond trading company Winsome Group allegedly defrauded a number of public-sector banks of several billions of rupees and routed most of the money offshore, accumulating defaults upwards of $1 billion on loans from a consortium of 15 banks in India. This made the diamond house the country's second-largest wilful defaulter after Kingfisher Airlines.
Zimbabwe president Robert Mugabe has been under fire ever since he justified last week the closure and nationalization of the country's diamond mines by claiming that the state has earned about $2 billion from the gems while about $15 billion was generated by the industry, thereby depriving the impoverished state $13 billion in direly needed revenue. The news media want to know why the government failed to act for years when now - after the fact - they claim to know that the companies had been siphoning off revenues for years.
The former top Belgian-Israeli diamond dealer and former De Beers sightholder, Erez Daleyot, who cleared out his Antwerp business leaving behind debts totalling nearly $230 million (€208 million), has thus far eluded his creditors by allegedly hiding out in Israel or South Africa - where he also used to run one of the largest diamond factories, reports Belgian daily De Tijd. Last week, the Antwerp Court of Appeals finally put the case to rest, declaring his former company D.D.
In a follow-up article to Chaim Even-Zohar's bombshell about CVD synthetic diamonds being sold on Alibaba with GIA natural diamond certificates, the Diamond Intelligence Briefing (DIB) identifies the name behind the fraud: Diwakar Dhyani.