By Caribbean News Now contributor
ST JOHN’S, Antigua — According to India’s Sunday Guardian newspaper, the extradition of fugitive Indian businessman Mehul Choksi from Antigua and Barbuda is unlikely to happen any time soon, if at all, as the government there is worried about the negative impact this will have on its citizenship by investment programme (CIP) and thus on its economy generally.
Choksi, an economic citizen of Antigua and Barbuda, is wanted by the judicial authorities in India for his alleged involvement in a $1.8 billion fraud against the Punjab National Bank (PNB).
In March 2018, non-bailable arrest warrants were issued by an Indian court against Choksi, and his nephews Nirav Modi and Neeshal Deepak Modi. They are suspected of colluding with two employees of PNB, the country’s second-largest state-owned lender, in the massive fraud. At least six PNB staff members and at least six employees of Choksi and Modi have been arrested so far.
The PNB fraud case relates to fraudulent letters of undertaking worth US$2.1 billion issued by the bank. The fraud was allegedly orchestrated by Choksi and his nephews.
Choksi has claimed that he is innocent and that all allegations against him are false, baseless and politically motivated.
Official sources in Delhi said that the response received from the government of Antigua and Barbuda regarding Choksi’s extradition was not “encouraging”, the Sunday Guardian reported.
“They have told us that Choksi followed all the prescribed legal process and went through thorough vetting before he was given the citizenship and hence they do not have a strong ground against him. Their primary concern is that if they throw out Choksi, then nobody will use the CIP in the future and it will have a very negative impact on their economy,” an official source said.
Sources added that the government of Antigua and Barbuda is “cooperating” with the Indian government but has clearly said that it will be difficult for them to revoke Choksi’s Antigua and Barbuda passport as it was acquired legally and nothing illegal was found against him during the vetting process.
The Sunday Guardian said it reached out to the office of the minister of foreign affairs in Antigua and Barbuda, E.P. Chet Greene; however, no official response was received.
Caribbean News Now likewise requested the Citizenship by Investment Unit (CIU) for an official comment/reaction for publication on the Sunday Guardian article, without response.
In August, the CIU issued a statement to provide what it described as “clarity and address misinformation that has been circulating in the public domain” regarding Choksi.
According to the CIU, Choksi’s application for citizenship was received in May 2017, with the necessary documentary requirements, including a police clearance certificate as required by the relevant law.
The police clearance certificate from the government of India, Ministry of External Affairs Regional Passport Office, Mumbai, certified that there was no adverse information against Choksi that would “render him ineligible for grant of travel facilities including visa for Antigua and Barbuda”.
Since then, however, there has been speculation in the Indian media that Choksi may have bribed officials there to issue him with a “clean” police certificate.
According to the CIU, Choksi’s application was subjected to stringent background checks, which included open source internet checks, Thompson Reuters World-Check, queries of various sanctions lists, engagement with regional and international intelligence agencies to include Interpol as well as contracted third party due diligence providers.
“In no instance was any derogatory information disclosed on the applicant,” the CIU said.
However, in the conduct of its due diligence, the CIU said it received documentation of two instances in which the Securities and Exchange Board of India (SEBI), in 2014 and 2017, opened investigations of a corporate entity owned by Choksi.
In 2013, SEBI barred Choksi from securities trading for six months due to suspected market manipulation in relation to Gitanjali Gems, of which Choksi was the managing director and a majority 51.62 percent stockholder.
“We requested updates on the status of the investigations and received documentary confirmation, issued by the SEBI, stating that, in one case, the matter had been satisfactorily closed, and indicating in the other that there is not sufficient evidence to pursue the matter further,” the CIU said.
The CIU also pointed out that notice of the current investigation was first issued by Indian authorities to law enforcement on January 31, 2018. As such, these matters emerged well after the background vetting process that would have resulted in the August 2017 approval of Choksi’s application and his subsequent registration as a citizen in November 2017.