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Antiques owned by Nirav Modi likely to go under hammer: Nirav used PNB money to buy personal assets, claims court-appointed trustee

At least, twenty-two antique statues, mostly from the 3rd Century Gandhara period owned by fugitive diamond merchant Nirav Modi, is likely to go under the hammer in the ongoing bankruptcy proceeding in the US court. These statues, that have substantial value in the international market, were brought from Christie's Auction House in March 2010 and recovered from Firestar Diamond office in New York. Another sculpture, a golden female head created by Indian artist Ravinder Reddy in 2000, was sold by Christie's in London in 2015.

These statues, including Stucco heads of Bodhisattvas, Terracotta heads of Buddha and females, were brought by Deepak Kumar Modi, Nirav Modi's father on 23 March, 2010 during the Christie's auction of Indian and Southeast Asian Art in New York.

Deepak had given a Hong Kong address during the auction. In the US court's record, he is shown as a citizen of India and a resident of Hong Kong. Interestingly, in June 2018, 6 months after Nirav fled India, his wife Ami Modi went to Firestar office in New York claiming to be the owner of these antique statues. Firestar and its associated companies Fantasy Inc and A. Jaffe Inc, had filed for bankruptcy in a New York court in February 2018.

After Ami demanded that statues be turned over to her, the chief restructuring officer asked her to produce the proof of ownership. She could not. In December last year, her counsel contacted her regarding the sculptures and the trustee, appointed by the court, yet again, demanded the proof of ownership.

Since then Ami or her counsel have not been able to provide the proof of ownership. But, one thing has become clear that Ami, a US citizen, was in New York in June last year. Under the US law, statues are treated as the property of debtor's estate (Firestar and associated companies) in the absence of any proof. The trustee has requested the court to declare that each sculpture is now the property of the estate. The sale process of Firestar and associated companies assets are on to recover the money. Last month the Income Tax department auctioned a total of 68 expensive artworks owned by Nirav for Rs 59.37 crore.

'Nirav Modi Used PNB Money To Buy Personal Assets'

The trustee has also alleged that Nirav, now jailed in the United Kingdom, used the money he acquired by defrauding Punjab National Bank (PNB) to purchase personal assets for himself and his family. The Ithaca Trust, set up by Nirav's sister Purvi Mehta, for Ami and their three children, was funded with $23 million in cash. The money in Purvi Mehta's account was funnelled by Nirav from PNB fraud, the trustee has alleged.

Although Purvi, in disclosure form for the Trust, mentioned that she funded it using dividends she received from a shadow entity 'Fine Classic FZE.' There is also huge transactions between Ami's and Purvi's accounts in 2017, just months before the PNB scam exploded all over the news.

Tens of millions of dollars of transactions were carried out between Ami Modi's HSBC account and Purvi's Bank of Singapore account. In September 2017, four months before the PNB fraud came to light, Ami transferred more than $31,506,000 to Purvi's account.

Nirav also owns Central Park Real Estate LLC that was created in February 2007. On 26 March, the company bought an apartment at the Essex House, which was used as Nirav Modi's personal residence. The money was paid via Firestar's account. At the end of December 2017, Central Park Real Estate LLC was bought by Ithaca Trust of Purvi Mehta for $6 million.

The Ithaca Trust money was used to purchase an apartment at Ritz Carlton in New York. In September 2017, $25 million was paid through Central Park LLC, an entity owned by Ithaca Trust. After the scam tumbled out, Nehal Modi, younger brother of Nirav, was appointed Trident Trust Company as the successor of the Ithaca Trust.

The US trustee has also accused former CEO of Firestar Mihir Bhansali of coordinating fraudulent transactions among the group's companies and shadow entities involving hundreds of millions of dollars. It said Firestar, Fantasy Inc and A. Jaffe Inc were engaged in sham transactions with shadow entities to launder huge amount of money. The three US-based companies received $155 million in cash transfers from mailbox companies owned by Nirav and transferred about $72 million to other shadow firms.

These shadow entities used for sham transactions includes Radashir Jewelery Private Limited, Eternal Diamonds, Empire Gems, Unique Diamond, Pacific Diamond, Universal Fine Jewelery, Aura Gems, Fancy Creations, SDC Designs, Vista Jewelery and Tri Color Gems. Nirav Modi's Chief Financial Officer Ajay Gandhi also directed transactions worth millions of dollars to multiple shadow entities.

Also See: RBI slaps Rs 2 cr penalty on Punjab National Bank for violating SWIFT norms

Bombay High Court refuses to grant relief for Nirav Modi's firm Camelot Enterprises in I-T Dept's painting auction

PNB scam: India working on expeditious extradition of Nirav Modi from UK, says MEA

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