CBI books two diamond firms for fraud

Mumbai: The Central Bureau of Investigation (CBI) on Wednesday registered six cases against two Mumbai based firms for alleged fraud to the tune of Rs 1,530.44 crore for non-payment of loans to three public banks.

The firms booked are part of M/s Winsome Diamonds Group whose loan payments are outstanding to the Central Bank of India, IDBI Bank and Vijaya Bank, according to CBI spokesperson R.K. Gaur.

The CBI officials said that the role of bank officials is also under the scanner. The said companies deal in jewellery and other items and they are allegations of cheating and criminal conspiracy against the chief promoters and other officials of these two private firms.

Those named in the First Information Report are Winsome Diamond Jewellery Limited, Forever Precious Jewellery and Diamonds Limited, and their chief promoter Jatin Mehta, the CBI said. The alleged irregularities pertain to 2012-13, said CBI sources.     

The investigating officials said that the complainant banks have alleged that these companies opened standby letters of credit for import of gold from foreign banks. The gold was then imported to India and was exported to 13 buying firms based in the United Arab Emirates (UAE).

“It is suspected that the 13 UAE buyers in connivance with the accused firms’ chief promoter, siphoned off the money under the scanner from UEA,” said an gency source.  

When the companies did not honour the standby letters of credits, the Indian Banks were forced to make payments to the foreign banks with them incurring losses to the tune of around Rs 1530 crore.

Individually the losses for the Central Bank of India is Rs 699.54 crore (approximately) in one case and Rs 255.24 crore in the other case.

The IDBI Bank Ltd suffered Rs 133.12 crore loss in one case and Rs 55.68 crore in another. The Vijaya Bank incurred loss of Rs 233.15 crore in one case and Rs 153.71 crore in the other case, the source said.

The CBI officials are also probing the roles of the bank officials. In 2016, the Enforcement Directorate (ED) had sent Letters Rogatory (LR) to Jordan seeking transaction details in the money-laundering case probe against two city-based jewellery export firms. The alleged default on loans was worth Rs 1,658.08 crore by Punjab National Bank.

The accused firm M/s Winsome Diamonds & Jewellery Ltd (WDJL) with an associate firm had allegedly availed the loan for the purchase of gold and diamonds from bullion banks and used it to export diamond and gold jewellery to 13 foreign companies in UAE. One Haytham Salman Ali, a Jordanian national, allegedly represented these 13 firms.