The Serious Fraud Investigation Office (SFIO), which functions under the Ministry of Corporate Affairs, has moved forward with legal action in the long-running Rs 13,000-crore banking fraud case by filing a prosecution complaint against fugitive diamond merchant Mehul Choksi. The complaint also names his wife, Priti Choksi, former ICICI Bank Managing Director and CEO Chanda Kochhar, along with several other individuals and corporate entities allegedly linked to the case.
In addition to the Choksi family and Chanda Kochhar, the prosecution complaint includes multiple former officials of Punjab National Bank (PNB). It also lists companies associated with Choksi, including Gitanjali Gems and Bezel Jewellery Private Limited, which investigators believe were used to facilitate or benefit from the alleged fraudulent transactions.
The complaint was filed in a Mumbai court last month, and judicial proceedings in the matter are scheduled to resume with the next hearing set for April. In total, the SFIO has named 41 individuals and entities in the prosecution complaint, reflecting the broad scope of the alleged conspiracy and the scale of the financial irregularities under investigation.
The SFIO probe, which began in February 2018 after the fraud came to light, involved extensive questioning of serving and former officials from major lending institutions, including ICICI Bank and PNB. Investigators examined whether there was collusion between bank officials and Choksi’s business network that enabled the alleged misuse of banking instruments over several years.
According to findings from a parallel investigation conducted by the Enforcement Directorate (ED), Mehul Choksi and his associates, allegedly acting in collusion with certain officials of PNB, fraudulently secured Letters of Undertaking and Foreign Letters of Credit. These instruments were allegedly used to raise funds without proper collateral or authorisation, resulting in a wrongful loss of Rs 6,097.63 crore to PNB. The ED has also noted that Choksi defaulted on loans obtained from ICICI Bank.
On the extradition front, Choksi was arrested in Belgium on April 11 last year following a formal extradition request submitted by Indian authorities. Since his arrest, he has been lodged in a prison in the Belgian city of Antwerp while legal proceedings related to his extradition continue.
In a significant development last month, Belgium’s highest court rejected Choksi’s plea that extradition to India would expose him to torture, inhuman treatment, or excessively harsh prison conditions. The Court of Cassation upheld an earlier ruling by a lower court that had approved India’s extradition request, clearing a major legal hurdle in efforts to bring Choksi back to face trial in the Indian courts.
