The long arm of the law is far too short for the Mehul Choksi or Vijay Mallya types. Someone like Choksi is safely out of the reach of Indian laws in the beautiful Caribbean island nation of Antigua. Agencies in India are left wracking their brains for a way to get the diamantaire repatriated from a country that is not signatory to any bilateral treaty that facilitates such action. All they need to for providing security or citizenship is loads of money.
Choksi was granted citizenship as an investor in Antigua just two months before the CBI started investigation of his involvement in the multi-crore-rupee Punjab National Bank fraud. He reportedly paid Rs 1.3 crore for the purpose. Choksi had apparently been given necessary clearances for citizenship of Antigua by the concerned Indian authorities. Antigua’s Citizenship by Investment Unit (CIU) has claimed that it has received no adverse report from agencies such as Securities and Exchange Board of India (SEBI) or the police. SEBI, though, has denied giving a positive report on Choksi to the CIU. Choksi had two cases against him taken up by SEBI, which the CIU said it had found to have been closed. CIU said it had documentary confirmation of the status of the cases.
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The other agency that the CIU has cited to have given a ‘clean chit’ was the local police in Mumbai. Choksi had applied for a police clearance certificate to the regional passport office, Mumbai, February 23, 2017.
He was issued with a ‘clear report’ March 10, 2017, based on verification with the Criminal Antecedents and Information System, the online database of criminal records of individuals. In fact, Choksi had been issued with a passport in 2015 under the ‘Tatkal’ category after the regional passport office granted him “No Police Verification Required” status.
The timing of the entire episode reeks of prior planning. Now with India having handed over a request for extradition to authorities in Antigua, hopes for the arrest of Choksi have been rekindled. But it remains to be seen whether Antigua will indeed allow India access to Choksi. If they do, then that country would lose global trust as a safe haven. This may impact their trade and commerce negatively.
Although the fugitive economic offenders Bill has become an Act with it receiving the signature of the Indian President, it has no teeth outside India. The fact that the Act covers only persons who commit fraud involving more than Rs 100 crore alone keeps many safe from action. What makes things more complicated is that India has weak extradition treaties with many nations. This means that the process of justice drags indefinitely in many cases as is being witnessed in the case of Vijay Mallya, too. While authorities are left grappling with the issue of finding ways to bring fugitive offenders to justice, banks in India are fleecing small customers to make good their losses. Data shows that 21 public sector banks and three major private sector lenders collected Rs 5,000 crore from customers for non-maintenance of minimum balance in their accounts in 2017-18. Obviously, this humongous amount belongs to extremely small depositors. It may be understood that by conniving and helping fraudsters like Choksi and Nirav Modi, the government is, in reality, harming the poorest of the poor. Laws notwithstanding, unless big frauds are identified right at the beginning and addressed effectively, the burden of making up for losses they cause will fall on the common man and his hard-earned savings. This also teaches us the lesson that no matter what any political leader may claim, the System in India is rotten to the core. Like these banking frauds, other such misdeeds can only be corrected if there is a conscious effort to change public character.
