Younger brother of fugitive diamantaire Nirav Modi, Nehal was charged with a $2.6 million fraud case in New York. A New York prosecutor charged him for fraudulently obtaining diamonds from one of the biggest diamond companies of Manhattan.
Manhattan District Attorney Cy Vance, Jr. said that Nehal was charged with First Degree Grand Larceny in a New York Supreme Court.
“While diamonds may be forever, this flawed scheme was not, and now Modi will face the clarity of a New York Supreme Court indictment. My Office will not allow individuals who have the privilege of soliciting business in Manhattan's iconic diamond industry to defraud our businesses or consumers,” added DA Vance.
According to the reports, Nehal got in touch with LLD diamonds USA in March 2015, through industry connections. He obtained $2.6 million worth diamonds from the store on credit terms. He then went ahead and liquidated them for his own use. Though he paid back a certain amount to LLD, he ended up using most of the money for his personal use.
"As alleged, Mr Modi conned a Manhattan diamond wholesaler into fronting him millions worth of diamonds for a purported deal with Costco that never existed," added Vance.
Apparently Modi got in touch with LLD in the pretext of building a relationship with Costco Wholesale Corporation (Costco) and diamonds worth $800,000 from them.
In the reports by New York court, it was said that, "After LLD provided the diamonds, Nehal Modi misleadingly informed the company that Costco had agreed to purchase them. Subsequently, LLD allowed the defendant to acquire the diamonds on credit, with full payment essential within 90 days. Nehal Modi then pawned the diamonds at Modell Collateral Loans, Inc. to secure a short-term loan.
This process of acquiring diamonds from LLD repeated again, claiming Costco wanting to purchase more diamonds. Nehal was given the diamonds by LLD on consignment basis and on a condition that he cannot sell those diamonds without their permission.
"LLD ultimately uncovered the fraud and demanded that Modi straight away pay his outstanding balance or return the diamonds. However, Nehal Modi had by now sold or pawned all of the diamonds and spent most of those proceeds. LLD subsequently reported the fraud to the Manhattan D.A.'s Office,” added the New York court.