State-owned Union Bank of India takes fugitive jeweller Nirav Modi to court in Hong Kong over firms’ alleged defaulting on US$5.5 million in loan repayments

Writ filed at High Court claims billionaire guaranteed loans to two firms in 2011, using US$2 billion in fraudulent guarantees issued by rogue Punjab National Bank staff at a Mumbai branch.

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Nirav Modi has been on the run since February. Photo: Handout

Published: 10:45pm, 27 Sep 2018Updated: 12:49am, 28 Sep 2018

An Indian state-owned bank has taken fugitive billionaire jeweller Nirav Modi to court in Hong Kong after two of his companies allegedly defaulted on more than US$5.49 million (HK$42.8 million) in credit facilities.

Union Bank of India claimed in a writ filed at the High Court on Wednesday that the Mumbai-born businessman, wanted over a massive financial scam in his home country, guaranteed two loans made to Firestone Trading Private on October 21, 2011 and Firestar Diamond on November 15, 2011.

The bank is demanding Modi – who owns a chain of jewellery shops from Hong Kong to New York and whose celebrity clients have included actresses Naomi Watts and Kate Winslet – pay more than US$5.49 million plus interest, after both firms allegedly defaulted on repayments.

The billionaire opened a chain of Nirav Modi shops. Photo: David Wong

Modi, 47, has been on the run since February after Indian authorities launched an investigation into his alleged involvement in a US$1.8 billion (HK$14.08 billion) scam against Punjab National Bank (PNB), the country’s second-largest state-run lender.

The Post reported in April that Indian authorities had submitted a request to Hong Kong’s Department of Justice for the provisional arrest of the diamond merchant, who was believed to have been hiding in the city before apparently moving to Britain.