Updated: Feb 24
The jewelry auction will take place on March 25 as per the court-appointed liquidator to handle the bankruptcy proceedings.
What is happening: Clearing a claim of nearly $1.5 billion, a court-appointed liquidator in India will start auctioning precious metals and gemstones belonging to Firestar Diamond International Pvt., owned by former tycoon Nirav Modi.
Why it matters: Nirav Modi has been absconding from the country since way back in 2018 while major offices, factories, and all other major assets of the corporate debtor had been attached by the Enforcement Directorate.
This move comes in light of Modi appealing his extradition.
Backdrop: Indian government accused Modi of defrauding the country’s second-largest bank, Punjab National Bank, of around $2 billion using credit guarantees for his diamond business.
The big picture: The liquidator has engaged the Gemological Institute of India, an industry group that provides certification services, to gauge the correct value of the gold and diamond items once owned by Modi.
The sale of gold, platinum, and diamond jewelry will take place through e-auction on March 25, as per the notice issued.
What the numbers say: The reserve price of the items to be auctioned will be declared on the auction date.
Pulling off one of the biggest bank frauds in the country, Nirav Modi and his uncle Mehul Choksi created a complex web of deception through fraudulent Letters of Undertaking (LoUs) to siphon off ₹14,000 crores from state-owned Punjab National Bank in connivance with some bank officials.
What is being said: "This will be the first auction of precious metals and stones” released by the government agency, which probes white-collar crimes.
Read in short: Former Diamantaire Nirav Modi’s gems go on sale for approx $1.5 billion.