How Mehul Choksi Cheated Punjab National Bank of ₹13,500 Crore: Exposing the Massive Scam

Punjab National Bank of ₹13,500 Crore Scam: After years of evading Indian authorities, Mehul Choksi—one of the key figures in India’s largest banking scam—has finally been arrested. He was picked up by Belgian authorities in Antwerp, bringing a new twist to a case that’s spanned continents, stirred global headlines, and left a ₹13,000-crore hole in one of India’s largest banks.

Punjab National Bank (PNB), India's second largest state-run lender by assets, had announced in 2018 that it had discovered a massive fraud, a case that shook the country's financial sector to its core.

Earlier on Monday, Choksi was arrested in Belgium at India’s request for extradition over his alleged involvement in the PNB loan fraud case.

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The alleged fraud, worth ₹13,500 crore, originated at a single branch in Mumbai and involved high-profile individuals, including billionaire jeweller Nirav Modi and his uncle Mehul Choksi, the managing director of Gitanjali Gems.

They allegedly used fake Letters of Undertaking (LoUs)—basically forged bank guarantees—to secure foreign loans from other Indian banks. These LoUs were never properly recorded in PNB’s systems, making it easy to keep the scam hidden for years.

When the fraud finally came to light, the damage had already been done—and both men had already fled the country.

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Who is Mehul Choksi?

Born in 1959 in Mumbai and educated in Gujarat, Choksi seemed like your typical rags-to-riches story. He lived a comfortable life with his wife Preeti and their three kids—a son and two daughters. But behind all that sparkle was a storm brewing.

Mehul Choksi isn’t just any businessman—he was once at the top of India’s diamond industry. He owned the Gitanjali Group, a jewelry brand that operated across India and even abroad. If you walked through a mall in the 2000s, you probably saw one of his stores.

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