Nehal Modi arrested: How Nirav Modi's younger brother was nabbed in the US

Nehal Modi

Nehal Deepak Modi, the younger brother of fugitive businessman Nirav Modi, has been arrested in the United States after Indian authorities formally sought his extradition. US prosecutors initiated extradition proceedings based on two charges: money laundering under Section 3 of the Prevention of Money Laundering Act (PMLA), 2002, and criminal conspiracy under Sections 120-B and 201 of the Indian Penal Code.

Nehal is a Belgian national and was arrested on July 4 following a Red Corner Notice issued by Interpol at the request of the Central Bureau of Investigation (CBI) and the Enforcement Directorate (ED).

He is wanted in connection with the multi-billion-dollar Punjab National Bank (PNB) fraud, one of India's largest banking scams.

Investigations by the ED and CBI allege that Nehal played a pivotal role in laundering illicit funds for Nirav Modi, who is also facing extradition proceedings in the UK.

Nehal is accused of helping conceal and transfer large sums of money through shell companies and international transactions in violation of Indian financial laws.

Authorities revealed that Nehal was a director of the now-defunct Firestar Diamonds USA and was involved with the Ithaca Trust, a financial vehicle allegedly used to buy and fund real estate for Nirav Modi. The trust reportedly received money siphoned from PNB via fraudulent Letters of Undertaking and routed through shell companies.

According to the ED, Nehal also tampered with evidence related to several dummy companies created by Nirav Modi across multiple jurisdictions including the UAE, Hong Kong, the US, the British Virgin Islands, and Barbados. These entities reportedly used secret servers located in the UAE, which Nehal is accused of destroying in January to hinder the investigation.

Further allegations state that following the PNB scam's exposure, Nehal, along with Nirav’s associate Mihir R. Bhansali, moved 50 kilograms of gold and large amounts of cash from Dubai. They also reportedly instructed dummy directors to withhold Nehal’s name from authorities.