John Carney Issues Examiner Report Finding Substantial Evidence of Fraud, International Money Laundering Connected to Diamond Bank Fraud Scheme

News / February 22, 2019

An investigation into an alleged money-laundering operation and bank fraud conducted by Partner John Carney is featured in an article published Feb. 21, 2019, in The Wall Street Journal. The article, “Samuels Jewelers Laundered Money in Indian Bank Fraud, Probe Finds,” reports on Carney’s work as the court-appointed investigator looking into an alleged international bank fraud that ran for years in the United States, India, Hong Kong and the United Arab Emirates. Partner Jorian Rose serves as lead counsel.

Last fall, Carney reported that he had found evidence that Firestar Diamond Inc. and other businesses controlled by Mehul Choksi and Nirav Modi deceived the Punjab National Bank on a massive scale.

In a report filed on Feb. 20, Carney reported that he discovered evidence that Samuels Jewelers, a U.S. retail chain controlled by Choksi that filed for bankruptcy last year, engaged in sham transactions, defrauded U.S. financial organizations and misled and deceived customers.

Law360 also reported on Carney’s investigation, including details of the interactions between Samuels Jewelers and other Choksi-owned companies.

Wall Street Journal coverage (registration required).

Law360 coverage (registration required).