NEW DELHI, India, April 14: Fugitive jeweller Mehul Choksi has been arrested in Belgium, a source from India’s Enforcement Directorate (ED) confirmed to Reuters, seven years after his alleged role in one of India’s largest banking frauds came to light.

According to the source, the Indian government had already submitted an extradition request for Choksi prior to his arrest. However, he is expected to challenge the extradition on medical grounds.

In 2018, Punjab National Bank (PNB), India’s second-largest state-owned lender by assets, revealed a massive $1.8 billion fraud that had occurred at a single branch in Mumbai. The bank lodged a criminal complaint with India’s federal investigative agency against several entities, including billionaire jeweller Nirav Modi and his uncle Mehul Choksi, who served as the managing director of Gitanjali Gems. PNB accused them of orchestrating fraudulent transactions that caused substantial financial losses.

India’s federal police subsequently filed formal fraud charges against Choksi, Nirav Modi, and others for their suspected involvement. Both Choksi and Modi have denied any wrongdoing.

In a 2018 letter, Choksi claimed that investigative agencies were acting with "pre-determined minds" and were interfering with the course of justice.

Choksi’s lawyer, Vijay Aggarwal, told the ANI news agency on Monday that they plan to appeal for his release, citing Choksi’s poor health and ongoing treatment for cancer. Reuters holds a minority stake in ANI. Aggarwal did not respond to Reuters' request for comment.

Nirav Modi fled India in 2018 before the full details of the case became public. He was arrested in the United Kingdom in 2019 and remains in custody, having lost one extradition appeal so far.

Modi grew up in Antwerp, Belgium — the global hub for diamond polishing — and Choksi was known to frequently visit the city, even before the fraud was uncovered. Diamond traders in Mumbai have said Antwerp would be a natural refuge for Choksi, given his longstanding connections in the industry there.

Choksi’s arrest comes shortly after another high-profile extradition: a Pakistani-born Canadian businessman accused of helping orchestrate the 2008 Mumbai attacks was recently transferred to New Delhi from the United States — the first such extradition in a terrorism case.