Banks play an important role in the economic development of the financial sector of India. They are running a business that involves all the transactions done by every person. As banks are running a business, sometimes they earn and sometimes they lose. The very common cause of banks losing money is the inability to collect the money-back which was distributed as and if they have a concentration of loans in a particular business segment that falls in hard times, those losses are even more severe.
In 2018, Punjab National Bank, one of India’s largest public-sector banks experienced a fraud of INR 11,400 crores at its Brady House branch located in Mumbai. The accused person was Mr Nirav Modi, a well-renowned diamond maker of India. Here’s the complete story of how the PNB scam was unfolded.
Nirav Modi is an Indian fugitive businessman; he is the founder of Firestar Diamond International and his uncle Mehul Choksi is the chairman of Gitanjali Group. These two companies were involved in the Diamond business and had a retail chain of 4000+ stores in India.
Nirav was brought up in Belgium and did his early schooling at the Wharton School at the University of Pennsylvania. He came back to Mumbai and started with his family business of jewellery manufacturing.
Nirav Modi’s Business of Luxury Diamond
In 1999, he founded Firestar. After working for years and getting experience in the business Nirav in 2008 launched a diamond store bearing his name in New Delhi. Seeing and attracting a huge crowd he thought of opening more stores and started the 2nd store in Mumbai followed by 17 more stores. Nirav launched his stores globally with stores in New York and Hong Kong city.
Nirav Modi Store
According to news, his company had a presence in 12 countries with 30 boutiques in 2018. Firestar is the only diamond manufacturing company in India to source the coveted Argyle pink diamonds, found only in Western Australia.
At this time Nirav was also looking to expand its product line with more affordable pieces. He became a lot popular after designing his “Golconda Lotus Necklace” with an old, 12-carat, pear-shaped diamond as a centerpiece in the year 2010. The diamond had previously been sold in the 1960s and had to be repolished.
Golconda Lotus Necklace
Stores were running very well and were recognized as a theme of pure luxury, many Indian celebrities were doing the advertisement for Nirav Modi’s jewellery. Nirav Modi was also featured in the Forbes list of Indian Billionaires in 2013. To run such a vast and huge business globally he was always in the need of funds which he took from small public sector banks.
How did Nirav Modi Avail Loans from Banks?
At first, he started with a small number of loans which he was able to repay the bank within the time limit. The first fraud started in 2010 when Nirav took the loan with the help of a fake letter of undertaking issued by PNB bank at its Brady House branch. Letter of Undertaking is said to be a sort of guarantee that is issued by a banking entity to the concerned party for attaining short-term credit from the overseas branch of an Indian bank.
How Nirav Modi Operated the PNB Scam?
Nirav thought of this as an easy way to obtain short-term credit. He then started giving fake Lou’s to the bank and used to obtain a lump sum amount of money. Nirav managed to get 1,212 more such guarantees in the next 6-7 years.
The Letters of Understanding were signed in favour of Indian bank branches for the one-year import of pearls, with the Reserve Bank of India’s guidelines allowing for a total of 90 days from the date of shipping. The guideline mentioned in the letters were ignored by overseas branches of Indian banks. They disregarded providing any documents or information with PNB that had been made accessible to them by the companies when they applied for loans.
When PNB approached banks to provide a 100% cash margin, the bank argued they had availed this facility in the past as well. The transactions were never registered in the bank’s main system, leaving PNB management in the dark for years. This suspected there could be a fraud that led to them digging further into the transaction history.
Later it was found out that PNB employees were also involved in this process of providing fraud loans. They got the commission from Nirav and used to do the job for him. PNB employees used the SWIFT network to send messages to Allahabad Bank and Axis Bank regarding financial requirements.
At that time they found that these letters were on a fraud basis and the money was transferred to Dummy accounts of firms that were inactive in business and were acting according to the command of Nirav Modi. A total of INR 6,400 crore acquired through PNB Lou’s was transferred abroad to buy real estate and personal property through “dummy corporations.”
Nirav Modi New York House
All these methods were used by him to transfer the money received by these banks for business purposes and were spent on his personal use and luxury. He escaped India in January 2018 after which a warrant was issued by the CBI and Enforcement Directorate to arrest him.
The PNB scam is said to be one of the biggest fraud cases in India’s banking history to date. Till now the Government authorities of India have sealed and auctioned several thousand crores worth of properties and assets of Modi. Yet the government has not been able to get money recovered in full.
There is a need for improvement in our Indian Banking Sector and mainly a focus on providing the loans and credit facilities to the people who need them the most and who can repay without making defaults.
FAQ
How did Nirav Modi get loans?
Nirav took the loan with the help of a fake letter of understanding issued by PNB bank.
How much money did Nirav Modi borrow from the bank?
Nirav Modi and his uncle Mehul Choksi defrauded the bank of over Rs 14,000 crore.
In which year did Nirav Modi take the loan?
Nirav Modi took the first loan from PNB on March 10, 2011, and later managed to get 1,212 more such guarantees over the next 74 months.
The 63 year old diamond trader is wanted by the Indian legislative authorities for the charges of money laundering, criminal conspiracy, corruption, cheating and dishonesty. He is also accused in the PNB scam case. He is an Indian born citizen who later took citizenship in Antigua and Barbuda in 2017. He owns the Gitanjali Group, which is a retail jewellery group with an extensive network of showrooms across India.
It was in 1985 that he took over Gitanjali Gems from his father which was the beginning of all the frauds to unfold. From various credible sources, it can be learnt that he is admitted in the Dominica China Friendship hospital in Roseau as of 30th May 2021.
On 26th May, after lots of efforts from law enforcement authorities, the scammer cum trader was arrested in the island country of Dominica.
Mehul Choksi was admitted to the hospital after he tests negative for Covid -19.
29 May 2021
Mehul Choksi was seen in custody with his left hand and eyes bruised.
27 May 2021
Mehul Choksi’s lawyer clarifies that he can only be deported to Antigua and not to India according to Immigration and Passport Act Section 17 and 23 since he is an antiguan citizen.
27 May 2021
The Antiguan Prime Minister Gaston Browne has requested Dominica to deport Choksi directly to India. If he is deported to Antigua, then he will be able to enjoy the protections given for a citizen.
23 May 2021
Mehul Choski goes missing from Antigua and Barbada. His lawyer and himself says that he was abducted.
The Beginning of the End for Mehul Choksi
The history of a long drawn out bank fraud came into light as PMLA issued non-bailable arrest warrants against Mehul Choksi, Nirav Modi and Neeshal Deepak Modi. They have been involved in a $1.8 billion scam in the second largest public sector bank, Punjab National Bank. The bank claims that Choksi along with Nirav Modi colluded with the employees to illegally obtain money from the bank.
Although he claims to be innocent even in an open letter, it does not go along with the fact that he left to the Carribean nation Antigua and Barbada just before the scam was disclosed.
His oath taking as a citizen of the same country a few days the after disclosure further adds oil to the fire. Later, the PMLA authorities responsible for the investigation found out that 41 properties that were held by the Enforcement Directorate in the name of Mehul Choksi were money laundering assets.
They ordered for the attachment of these properties worth 1210 crore. Following the order, a mall in Kolkata, 15 flats and 17 office premises in Mumbai, a four-acre farm house in Alibaug and 231 acres of land at locations like Nashik, Nagpur, Panvel in Maharashtra and Villupuram in Tamil Nadu were attached by the ED in keeping up with the Prevention of Money Laundering Act.
There was confirmed information that Mehul Choksi was there in Antigua and Barbuda. However, he went missing on May 23,2021. His car was later discovered in the Jolly Harbour area which strengthened the assumptions that he escaped to Cuba. However, the truth was revealed as he was confirmed to be in the Carribean country of Dominica.
Since he was trying to flee to Cuba, this attempt can be used by the CBI to strengthen their claims for extradition. Another twist to the plot came when Choksi’s advocate alleged that he was kidnapped by someone who Choksi believes to be an Indian and Antiguan police into Dominica in a boat.
The Story Now of Mehul Choksi
The High Court of Justice Commonwealth of Dominica has stayed the extradition order of the scammer. The pictures of his swollen eyes and injured left hand are flooding the social media.
The efforts of Indian agencies have not ceased. They continued to call the Antiguan government to extradite him by claiming that he is in fact an Indian citizen and has an Interpol Red Corner Notice issued in his name. Another group of people says that the Red Corner Notice cannot be used in this case since the task of locating the criminal is already done.
At the same time, the Antiguan opposition party is clearly making use of this opportunity to support Choksi against the extradition claims of India. It is widely perceived as their attempts to later procure campaign funding from Choksi as a return gift.
Mehul Choksi leaves India for the USA. He fled through Mumbai International Airport
Punjab National Bank files complaint against Mehul Choksi and Nirav Modi for defrauding the bank by colluding with the bank employees
CBI files probe against the scammers (Mehul Choksi, Nirav Modi, Nishal Modi). Raids and searches were also done.
February 2018
The amount involved in the fraud was disclosed to be $1.7 billion.
CBI files case against the Gitanjali group.
PNB CEO announces that the losses are hoped to be compensated in 6 months.
Union Bank of India announces its exposure of $300 million in association with the PNB scam while of State Bank of India, it was $212 million.
Choksi claims to be innocent.
July 2018
Interpol at the request of CBI issues Red Corner Notice against Mehul Choksi.
Choksi reaches Antigua after taking oath of citizenship earlier in 2018.
March 2019
The UK Home Secretary accepts the extradition request of CBI and the files were to Westminster court.
May 2021
Mehul Choksi goes missing.
Later he gets caught in Dominica.
CBI is waiting for the clearance of extradition.
FAQ
What did Mehul Choksi do?
Mehul Choksi and his nephew Nirav Modi are the key accused in the 2018-Punjab National Bank (PNB) scam which was estimated to be around ₹13,500 crores.
When did Mehul Choksi leave India?
Mehul Choksi left India on 7 January, 2018 and few days later, the PNB scam was disclosed.
Where is Mehul Choksi right now?
Mehul Choksi had been staying in Antigua and Barbuda since January 2018.
The concept of brand endorsements by celebrities has become a rage in the world, every big company wants to sign top celebrities as their brand ambassador. This is because it is a profitable marketing strategy as the brand uses the celebrity’s glamour and popularity to market their products and services. Having a global celebrity will help the company reach its target audience.
Which is why celebrities like Priyanka Chopra, that have a foothold in the global audience are always in demand by both Indian and international brands. Priyanka Chopra Jonas is an Indian actress, model, singer and recently a film producer. Priyanka is one of the highest paid actresses in the country and has also won the world renowned pageant, Miss World in 2000.
The actress has won many awards and accolades such as Filmfares, National Film Awards and was also honored with Padma Shri by the Indian Government. According to Forbes, Priyanka Chopra is in the list of The 100 most influential people in the world. Priyanka is known for work in movies such as 7 Khoon Maaf, Barfi, Mary Kom, Dil Dhadakne Do, Kaminey, Bajirao Mastani, The Sky is Pink, The White Tiger, etc.
She is also played the role of a main character in the American thriller series Quantico. Besides her acting career, Priyanka has released three singles, given her vocals for songs in the movie and has also producer some well-known movies.
The actress is known to charge over 5 crore and even Rs. 2 crores for an Instagram post for brand promotion. The brand value of the actress is estimated to be Rs. 2.65 billion, with a net worth of $50 million in 2021.
The actress has endorsed brands such as Bumble, Pepsi, Pantene, Nokia, Assam Tourism, Garnier, TAG Heuer, Nirav Modi, Appy Fizz, UNICEF, Beats by Dre, Schmitten Luxury Chocolates, Lux, Xpert Dish Wash, Colgate, Pro-Ease, Hero MotoCorp, Josco, LYF Smart Phones, Idea Spice Phones, Marvel Tea Yellow, Q Linq, Ponds, Bru, Rajnigandha silver pearls, Blenders pride, Nikon, Sunsilk, Asmi, J Hampstead, Unnati Fortune among others.
Lets look at the List of the brands endorsed by Priyanka Chopra
Appy Fizz
Appy Fizz is a carbonated apple juice brand that is under Parle Agro. The company introduced Appy Fizz in 2005 after the success of the Appy another apply juice brand popular in India. Parle Agro launched a similar drink Grappo Fizz a carbonated grape juice, which failed because of a campaign.
Appy Fizz is also manufactured and marketed in countries like Bangladesh by Global Beverage Co Ltd. under license from Parle Agro. Priyanka became the brand ambassador of the brand in 2016 and has appeared in many ad commercial endorsing the brand.
Parle Agro came up with a multimedia campaign featuring Priyanka and the South Indian star Jr.NTR in order to create a tremendous buzz among the current generation. With Priyanka endorsing Appy Fizz, the brand has repositioned itself very bold, memorable and a cult brand.
Nirav Modi Jewels
Nirav Modi was one of the top luxury diamond jeweler known for its diamond studded jewelry. The brand was known for its collection of bracelets, earrings, necklaces, pendates, rings, etc.
At the time Priyanka was made the brand ambassador she said that, “My association with Nirav Modi is like meeting of minds in many ways. We are both proud of our Indian heritage and are also united by the idea of bringing a modern Indian to the global forefront.”
Priyanka became the brand ambassador and hasappeared in an ad commercial along with actor Siddhrath Malhotra, but terminated her three year contact in the light of the allegations of financial fraud against Nirav Modi.
Bumble is an American social media company that is known for its online dating app that facilitates communication between interested users. One of the most unique feature of the app is that in heterosexual matches, only the female users can make the first contact with matched male users, while in same sex matches both can send a message first.
The company was founded by Whitney Wolfe Herd and is a competitor to Tinder another dating app in the Indian and international market. As of 2021, the app has over 42 million monthly users across 150 countries and is valued at $1billion according to Forbes.
Priyanka not only endorses the app but also acts as a partner, advisor, and investor of the company. With the help of Priyanka, Bumble has expanded in the country and has also made women feel safe using dating apps in India. Commenting on her investment in the company the actress said that “I’ve always believed that investing in women is key to social transformation and economic growth.”
Pantene
Pantene is a world famous brand of hair care products that are owned by Procter and Gamble. The company was originally started in 1945 by Hoffmann La Roche. Pantene was purchased by Procter and Gamble in 1985 in order to compete in the Beauty products market.
The brand is known for its products such as 2-in-1 shampoo and conditioning formula like Pantene Pro-V. Priyanka became the company’s global brand ambassador, making her the first Indian actor to represent the brand globally.
In an interview the actress said that she is excited to be the new global ambassador for Pantene. She also added that the brand is a favorite around the world and she loves that Pantene celebrates and advocates that being strong is beautiful.
Garnier is one of the top cosmetics brands that belongs to the French cosmetic conglomerate L’Oreal. The brand is known for hair and skin care products and has so far branded its image as a healthy beauty expert by providing nature based solutions to combat pollution, acne UV and fatigue.
The company sells its products in numerous countries worldwide with products targeting for different skin types and cultures. Priyanka was the brand ambassador of Garnier and has been featured in commercials endorsing the Garnier Light Ultra Intense Fairness Moisturizer in both the print and television campaign.
But over past years priyanka has expressed her regret over appearing in adverts for skin-lightening cosmetics. In an interview, priyanka called the ponds and garnier fairness endorsements to be one of her profound regrets and apologized for the same.
Colgate
The Colgate Palmolive Limited is an American company which is a leader in India when it comes to scientifically proven oral care products. The company is known for its products its wide range of products such as toothbrushes, dental floss, tooth powder, mouthwash and other specialized range of dental therapies.
The Colgate Palmolive India Ltd was initially incorporated in 1937. Priyanka Chopra became Colgate brand ambassador and has also been featured in it campaigns and ads endorsing its Colgate Active Salt Neem’s toothpaste that recommends proper oral care.
Eric Jumbert the marketing director of Colgate-Palmolive (India) Limited said that the company found the actress to be the perfect fit to be the company’s brand ambassador as she has inspiring personality and global superstar who embodies our brand values so well.
LYF pronounced as Life is is one of the top mobile companies in India. Also known as Reliance LYF, the Indian smartphone manufacturer has its headquarters based in Mumbai, Maharashtra. The company is a subsidiary of Jio which is owned by Reliance Industries.
LYF has also became the country’s fifth largest smartphone player and the second largest LTE phone supplier. The company signed Priyanka Chopra as it brand ambassador for LYF smartphones in 2016.
The actress has been a part of many multimedia campaigns. The company made a commercial featuring Priyanka showcasing the newest smartphone, LYF Earth 2. The actress also tweeted an ad for the phone, where she is seen explaining the features of the device in the most natural way.
Schmitten Luxury Chocolates
Schmitten Chocolates is a surat based chocolate brand that is owned by Rajhans Group. The brand has grown to become one of the well-known names in the luxury chocolate business. With the brands such as Schmitten and Hoppits, Rajhans group has got a turnover Rs 300 crore in just four years of its launch.
Luxury Chocolates are available in dark and milk chocolates with seven different variants. The company is planning to expand it and is expecting sales worth Rs 1,000 crore from chocolates.
Which is why the group choose Priyanka as the brand ambassador for the schmitten brand. The actress has appeared in many of its commercials endorsing its luxury chocolates.
The Assam state government signed an agreement with the international star Priyanka Chopra to become a brand ambassador for Assam tourism in 2016. The actress was featured in the Awesome Assam Campaign which showcased the actress exploring and enjoying her stay while attending a friend’s wedding in Assam.
The Awesome Assam campaign was launched in 2017 by the Assam Tourism board in order to boost the tourism sector in the state. The campaign focused on the one-horned rhino, Assam Tea and the mighty Brahmaputra.
Xpert Dish Wash
Xpert is a dishwash brand that is owned by RSPL Group. The brand has a history of television advertisements that portray how its products have made the life of homemakers easier. The brand signed Priyanka Chopra as its brand ambassador and with the help of priyanka the brand wants to attract more customers and make it reach its target audience.
Priyanka Chopra Jonas is one of the most popular an Indian actress, model, singer and recently a film producer.
What is the brand value of Priyanka Chopra?
The brand value of Priyanka Chopra is estimated to be Rs. 2.65 billion.
What are the main brands endorsed by Priyanka Chopra?
The main brands endorsed by Priyanka Chopra are Bumble, Assam Tourism, Garnier, Nirav Modi, Appy Fizz, Xpert Dish Wash, Colgate, LYF Smart Phones, Schmitten Luxury Chocolates, Pantene, etc.
What are the other brands endorsed by Priyanka Chopra?
The other brands endorsed by Priyanka Chopra are Pepsi, Nokia, TAG Heuer, UNICEF, Beats by Dre, Lux, Pro-Ease, Hero MotoCorp, Josco, Idea Spice Phones, Marvel Tea Yellow, Q Linq, Ponds, Bru, Rajnigandha silver pearls, Blenders pride, Nikon, Sunsilk, Asmi, J Hampstead, Unnati Fortune among others.
How much does Priyanka Chopra charge for brand endorsement?
Priyanka Chopra is known to charge over Rs. 2 crores for an Instagram post for brand promotion.
What is the net worth of Priyanka Chopra?
The net worth of Priyanka Chopra is over $50 million as of 2021.
Conclusion
From being crowned as the Miss World to getting married to Nick Jonas, the actress been the face for various brands worldwide. Priyanka Chopra is currently one the most talked about Indian people in the world as she has established a food hold in the Hollywood by playing lead roles in top rated movies. Priyanka is also the second highest most followed Indian on social media platform after Virat Kohli.
Another reason for her being in demand in the advertising world is that the actress has earned a name for herself in the world with hard work and perseverance which are key requirement for a brand ambassador. The global fame has led the actress to work with many Indian and international brands, ranging from gadget to cell phone to cosmetic products to watches and with the current pace of her growing popularity the list is bound to get longer.
Anik Banerjee
