Nehal Modi, younger brother of fugitive diamantaire Nirav Modi, has been indicted here on the charge of fraudulently obtaining diamonds worth over $2.6 million from one of the world’s biggest diamond companies in Manhattan.
Nehal, 41, faces the charge of grand larceny in the first degree, Manhattan district attorney Cy Vance Jr said in a statement on Friday.
“While diamonds may be forever, this flawed scheme was not, and now Modi will face the clarity of a New York Supreme Court indictment,” Vance said.
Interpol had earlier issued a red-corner notice against Nehal on charges of money laundering that are being probed by India’s Enforcement Directorate.
Nehal, a former member of Noble Titan Holdings, had allegedly made false representations to obtain over $2.6 million worth of diamonds from LLD Diamonds USA on favourable credit terms and consignment, and then liquidated the diamonds for his own ends.
Vance’s statement said Nehal, “who comes from a well-known family in the diamond industry”, had initially been introduced to the president of LLD Diamonds through industry associates.
In March 2015, he allegedly got LLD to provide him with several diamonds, worth nearly $800,000, claiming he was pursuing a relationship with Costco Wholesale Corporation and wanted to present the diamonds to it for a potential sale.
After LLD provided the diamonds, Nehal allegedly lied to the company saying Costco had agreed to buy them. Subsequently, LLD allowed him to buy the diamonds on credit, with full payment required within 90 days.
Nehal then pawned the diamonds at Modell Collateral Loans to secure a short-term loan, Vance’s office said.
Nehal is said to have later taken diamonds from LLD several times for purported sale to Costco and some payments to LLD, but allegedly used most of the proceeds for personal use and other business expenses. Nehal’s brother Nirav, 49, is wanted in India on charges of fraud and money laundering. He has been in a London prison following his arrest in March last year.
The New York Post quoted Nehal’s lawyer Roger Bernstein as saying “this is a commercial dispute” and “Nehal is not guilty”.
