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Gitanjali Loses Sightholder Status

De Beers offloads client following fraud allegations.
Apr 16, 2018 8:46 AM   By Joshua Freedman
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RAPAPORT... De Beers has terminated the sightholder status of Gitanjali Gems following fraud allegations against the Indian jeweler’s managing director, Mehul Choksi.

De Beers took the decision in February, meaning Gitanjali can no longer make any purchases from the company, a spokesperson for the rough producer confirmed in a statement to Rapaport News Monday.

“De Beers has introduced more rigorous financial compliance criteria for sightholders that require full compliance for financial accounts that started on or after January 1, 2017,” the spokesperson said. He declined to comment on the Gitanjali case specifically.

In February, Punjab National Bank alleged that Choksi and his nephew, jeweler Nirav Modi, had defrauded the lender of $2 billion by obtaining unauthorized loans. Gitanjali’s share price has slumped about 90% since February 12.

Modi’s US-based diamond companies, Firestar Diamond, Fantasy and A. Jaffe, were never sightholders, De Beers confirmed. Firestar has been a customer of De Beers’ auction-sales business in the past, but that status is no longer active, it added.
Tags: a. jaffe, Choksi, fantasy, firestar diamond, fraud, Gitanjali, Gitanjali Gems, Joshua Freedman, Mehul Choksi, Nirav Modi, Punjab National Bank, Rapaport News, sightholder
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