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CBI books Jatin Mehta in two fresh cases of loan fraud

CBI books Jatin Mehta in two fresh cases of loan fraud
Central Bureau of Investigation office

Absconding diamond trader Jatin Mehta has been booked by CBI in two fresh cases of alleged loan default. Based on a complaint by Bank of Maharashtra and Union Bank of India, the agency has booked Mehta and his company Winsome Diamond and Jewellery for alleged loan fraud of over Rs 587.55 crore.

According to the complaints from the two state-run banks, Mehta allegedly cheated Bank of Maharashtra to the tune of Rs 323.40 crore while Union Bank of India suffered a loss of Rs 264.15 crore, sources said.

The agency has booked the company, Mehta, whole time directors Ramesh I Parikh and Ravichandran Ramasamy, independent director Harish Ratilal Mehta and Jordanian national Hathyam Salman Ali Abu Obeidah on the basis of the complaint from Bank of Maharashtra.

In the FIR filed on the basis of the complaint from Union Bank of India, the CBI has named the company, Mehta, Bombay Diamonds Company Pvt Ltd and Obeidah as accused. Both banks were part of a 14-bank consortium that had extended credit facilities worth over Rs 4,600 crore to Winsome Diamonds for which original promoter and guarantor was Mehta, the officials said. He left the country even before the banks could sniff the scam and is believed to be in one of the Caribbean islands, St Kitts, CBI sources said.

The agency has already filed at least seven FIRs against him related to alleged bank frauds. The company had purchased gold from bullion banks abroad -on loan basis against the Standby Letter of Credit (SBLC) issued by Indian banks, the banks alleged.

The SBLC is a guarantee issued by a bank assuring another bank that it will make payment in case of default by its client. The gold was processed by the firm and sent to 13 buyers in the UAE suspected to be hand in glove with Winsome Diamonds and its directors, it said. Once the payments were not received by foreign banks, they liquidated the SBLCs, bringing liability on Indian banks which had to make the payments.