PNB fraud: Choksi’s Hong Kong firm director, Deepak Kulkarni, arrested in Kolkata

The Enforcement Directorate on Tuesday, November 6, said that it has arrested from Kolkata a director of a shell company of fugitive diamantaire Mehul Choksi in the ₹13,500 crore Punjab National Bank (PNB) fraud case.

"We have arrested Deepak Krishna Rao Kulkarni from Kolkata Airport on the basis of a Look Out Circular (LOC) issued against him late on Monday," said a senior ED official.

Kulkarni, who was coming from Hong Kong was detained at the airport by the ED officials in Kolkata who then took him to their office.

They would seek a transit remand of Kulkarni as the PNB fraud case is registered in Mumbai.

Mehul Choksi diverted over ₹3,257 crore of the money raised from fraudulently obtained letters of undertaking (LOUs) and foreign letters of credit (FLCs) to overseas dummy firms.

Kulkarni was director of one of the dummy companies of the Gitanjali Group owner in Hong Kong, the financial-probe agency official said. He was also made an accused in the charge sheet filed against Choksi and a non-bailable warrant was issued against him.

Mehul Choksi and Nirav Modi are under probe by both the Central Bureau of Investigation and the ED. The ED filed money laundering cases against them and others on February 15 on the basis of an FIR registered by the CBI.

The ED had on May 24 and May 26 filed charge sheets against the two. The ED in its chargesheet against Choksi had alleged that from 2015 onwards a part of the funds was used for repayment of dues of various banks. On scrutiny of the bank account details of the said Indian entities, it was found that huge amounts of debits have been allegedly made from the accounts of these entities maintained with the PNB to the overseas companies of the Gitanjali Group.

"During investigation, it was revealed that transfer of funds was made to the 4Cs Diamonds Distributors, Crown Aim Ltd, Shangyang Gong Si Ltd, Taipingyang Trading Ltd, Abecryst (Thailand) Ltd, and Asian Diamond and Jewellery FZE from the accounts of the Indian entities.

While an Interpol issued Red Corner Notice (RCN) is on against Nirav Modi, his kin and associates. The RCN request against Choksi, who acquired Antiguan citizenship earlier in 2018, is pending with the Interpol.