A New York Supreme Court has indicted Nehal Modi, the younger brother of Nirav Modi, for fraudulently obtaining diamonds worth over 2.6 million US dollars from LLD Diamonds, USA, which is one of the world’s biggest diamond companies, PTI reported.
Reports said 41-year-old Nehal who comes from a well-known family in the diamond business industry was introduced to the president of LLD Diamonds through industry associates.
In 2015, between March and August, Nehal managed to obtain diamonds worth over 2.6 million dollars from LLD on favourable credit terms and consignment by making false representations and then liquidated the diamonds for his own ends.
It may be noted that in 2019, the Interpol had issued a Red Corner Notice against Nehal Modi as he was named in the chargesheet filed by the Enforcement Directorate in the PNB scam in which his brother Nirav Modi is the main accused. Nehal had allegedly helped Nirav in diverting money to shell corporations.
Here is how he scammed LLD Diamonds, according to the indictment, court filings, and statements made on the record in Manhattan court:
{{/usCountry}}Here is how he scammed LLD Diamonds, according to the indictment, court filings, and statements made on the record in Manhattan court:
{{/usCountry}}> In March 2015, he approached LLD claiming that he was pursuing business talks with Costco Wholesale Corporation for which he needed diamonds from LLD which would potentially be bought by Costco.
> Then Nehal falsely informed LLD that Cotsco agreed to purchase the diamonds following which LLD allowed him to purchase those on credit. Full payment was required within 90 days.
> But Nehal mortgaged the diamonds to secure short-term loans.
> In the meantime, he made some payments to LLD but the majority of the proceeds were used for personal expenses.
> He also falsely claimed that he was encountering payment issues due to a “Costco fulfillment error” and made repeated promises to satisfy the balance.
> In August 2015, Nehal falsely informed LLD that Costco wanted to purchase additional diamonds. This time, LLD permitted him to take the additional diamonds on consignment, with terms explicitly stating that he did not have the authority to sell the diamonds without authorisation by LLD.
> LLD also required a partial payment upfront in the event of a sale, as Nehal’s outstanding balance was nearly USD 1 million at that time.
> LLD finally uncovered the fraud and demanded that he immediately pay his outstanding balance or return the diamonds. However, he had already sold or pawned all of the diamonds and spent most of those proceeds, following which LLD reported the fraud to the Manhattan DA’s Office.
Nehal Modi is a citizen of Belgium and knows English, Gujarati, Hindi.
(With PTI Inputs)