SEBI Freezes Mehul Choksi’s Bank Accounts To Recover Rs 2.1 Crore In Insider‑Trading Case

In a significant enforcement action, the Securities and Exchange Board of India (SEBI) has issued a notice for the attachment of all bank accounts, lockers, and financial proceeds held by Mehul Choksi across Indian banks. This follows his failure to pay penalties related to the Gitanjali Gems Ltd case.

Dues Arising from Gitanjali Gems Penalty Order
As per the notice, the total recoverable amount stands at Rs 2.1 crore, which includes:
Penalty: Rs 1.5 crore, imposed by Whole-Time Member (WTM) of SEBI dated January 31, 2022
Interest: Rs 60 lakh calculated at 1% per month from February 2022 to May 2025
Recovery Cost: Rs 1,000

This order was issued in the matter of Gitanjali Gems Limited, a company previously helmed by Mehul Choksi and embroiled in financial fraud investigations.

Failure to Comply Triggers Bank Account Freeze
The SEBI recovery officer noted that no payment had been made by Choksi despite a demand notice being issued on May 15, 2025. Given the potential risk that Choksi might dispose of or transfer the funds, SEBI moved swiftly to safeguard its recovery interests.

“There is sufficient reason to believe that the Defaulter may dispose of the amounts/proceeds in the Bank Accounts held with your Bank,” SEBI stated in its notice.

Scope of Attachment: All Accounts and Proceeds Covered
In a sweeping move, SEBI directed all banks in India to immediately attach:
All bank accounts and lockers, whether held singly or jointly by Mehul Choksi.
Any other proceeds or amounts, currently due or that may become due in future, which are held by banks on behalf of Choksi.
This action blocks any potential transaction or withdrawal by Choksi from these financial assets until SEBI recovers the full dues.

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Background: The Gitanjali Gems Saga
Mehul Choksi, once a high-profile businessman, fled India in early 2018 amid a massive banking fraud probe involving Gitanjali Gems and Punjab National Bank (PNB). He was accused of colluding with bank officials to siphon off funds through fraudulent Letters of Undertaking (LoUs).

Though the criminal cases are ongoing, this recovery action pertains to regulatory penalties imposed by SEBI under securities law violations.
 

Next Steps in Enforcement
SEBI’s order is enforceable across all Indian banks, which are now obligated to comply and report any assets or funds traceable to Choksi. This move adds pressure on Choksi, who has been resisting legal proceedings while staying abroad.

It remains to be seen whether this financial clampdown will lead to further legal cooperation or expedite recovery for Indian authorities.