August 27, 2018 – Punjab National Bank (“PNB”) filed with the Court a motion directing the appointment of an examiner in the Samuels Jewelers case [Docket No.142]. PNB asserts, “PNB seeks the appointment of an examiner, pursuant to section 1104(d) of the Bankruptcy Code. The Debtor in this case is 100% owned by Gitanjali Gems, Ltd. (‘Gitanjali’) whose chairman and director is Mehul Choksi (‘Choksi’). Both Gitanjali and Choksi have been implicated in the largest bank fraud (the ‘Fraud’) in the history of the Republic of India. They have been indicted by Indian authorities, and Choksi is currently an international fugitive from justice. PNB is the largest victim of that Fraud….This case has significant similarities and connections to In re Firestar Diamond, Inc., Case No. 18-bk-10509 (SHL) (Bankr. S.D.N.Y.) proceeding before the Honorable Sean Lane in New York….Like the Debtor in this case, the Firestar Debtors cited the Fraud as a major factor in their filing for bankruptcy and attempted to proceed as though they were unconnected to the Fraud. As events unfolded, however, that facade of innocence collapsed as the Firestar Debtors’ President and former sole director invoked his Fifth Amendment rights against self-incrimination, a Chapter 11 trustee was appointed, and the Examiner published its report making it clear the Firestar Debtors participated in the Fraud. The similarities between these cases – and the underlying fraud – underscores the compelling need for the appointment of an examiner in this case. The Court should appoint an examiner in this case to ensure the integrity of these proceedings and allow a neutral third-party to assess the claims that might exist for and against the estate of the Debtor.”
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