Synopsis : Fugitive diamantaire Mehul Choksi, key accused in the ₹13,500 crore PNB loan scam, has been arrested in Belgium after years on the run. His arrest reignites hopes of extradition and recovery of defrauded public money.
Mehul Choksi's Arrest: A Major Step in India’s Pursuit of Economic Justice
The Indian government’s relentless pursuit of economic offenders has hit a crucial milestone with the arrest of Mehul Choksi in Belgium. Accused in one of the most significant banking frauds in India’s history, Choksi had evaded capture since 2018, making his detention a moment of relief and renewed accountability for the Indian banking system.
The PNB Scam Unfolded
In early 2018, the Punjab National Bank (PNB) reported a massive loan fraud exceeding ₹13,000 crore. Mehul Choksi, along with his nephew Nirav Modi, allegedly manipulated internal banking systems to secure unauthorized Letters of Undertaking (LoUs) and Foreign Letters of Credit (FLCs) without maintaining proper financial records or securities.
These LoUs were used by Choksi’s firm, Gitanjali Gems, to borrow huge sums from various international banks including SBI and Axis Bank. As these loans were unrecorded in PNB’s main banking system, the fraud remained undetected until it reached a crisis point.
Ultimately, the bank had to declare over $2 billion in exposure as Non-Performing Assets (NPAs), severely affecting its balance sheet and investor confidence in India’s public sector banks.
The Great Escape
Before the scam became public, Choksi fled India in January 2018. He had already acquired citizenship in Antigua the previous year, a strategic move that complicated India's efforts to extradite him. While Nirav Modi was arrested in the UK in 2019, Choksi remained elusive, navigating different countries under various pretexts, mostly citing health-related concerns.
In 2021, Choksi made headlines again when he was detained in Dominica under mysterious circumstances. He claimed he had been kidnapped and tortured while attempting to flee to Cuba. However, he was ultimately sent back to Antigua.
Arrest in Belgium
Recently, Indian intelligence agencies tracked Choksi’s movements and confirmed his presence in Belgium, where he was reportedly receiving treatment for blood cancer. On the basis of this confirmation, the Central Bureau of Investigation (CBI) and the Enforcement Directorate (ED) coordinated with Belgian authorities and succeeded in getting him arrested.
Two Mumbai courts had already issued open-ended warrants against Choksi in 2018 and 2021. These warrants, coupled with the mounting pressure from Indian authorities, finally led to his detention.
Extradition Hurdles Ahead
While Choksi’s arrest is a step forward, bringing him back to India will not be straightforward. His legal team has already hinted at opposing extradition on medical grounds, citing chronic lymphocytic leukaemia and lymphoma as conditions unfit for long-distance travel.
This medical defence has been used repeatedly by Choksi to delay proceedings. Legal experts predict a lengthy courtroom battle, where Belgian courts will examine India’s extradition request alongside human rights and health concerns.
The Indian side, however, remains confident. CBI and ED officials have pledged to present a water-tight case to ensure Choksi faces the Indian judicial system.
Financial Recovery Efforts
Besides legal procedures, Indian authorities are actively pursuing the recovery of defrauded assets. The ED has already attached properties worth ₹2,565 crore linked to Choksi, including luxurious homes, bank accounts, and high-value items like jewellery and vehicles.
Investigations have also revealed that Choksi holds properties in Dubai, Japan, Thailand, and the US. Indian authorities are now collaborating with international enforcement agencies to identify, freeze, and repatriate these assets.
This global cooperation is crucial to recover taxpayer money and restore public faith in the integrity of the banking system.
What This Means for India
Choksi’s case has become emblematic of the need for banking reforms, better inter-agency coordination, and international cooperation against white-collar crimes. The scam triggered a nationwide call for stricter compliance mechanisms and led to a shake-up within banking circles.
Moreover, his arrest sends a strong message that economic offenders can no longer exploit legal loopholes and international boundaries to escape justice.
Looking Ahead
The coming months will be decisive. If extradited, Mehul Choksi will join a growing list of economic offenders brought back to India, including Vijay Mallya and Nirav Modi, both of whom are fighting extradition.
India’s success in this case could also pave the way for swifter extraditions in future cases involving financial frauds. For now, the country waits to see whether the long arm of Indian law can finally bring Mehul Choksi home to face justice.
Disclaimer : This article is intended for informational purposes only. All facts and data are based on publicly available reports as of the date of writing. Legal proceedings are ongoing, and outcomes may vary.
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