Liquidators are asking U.S. banks for information on whether two bankrupt London-based companies—which had alleged links to Winsome Diamonds’ 2013 default—also had dealings with several lab-grown diamond companies.
According to two declarations filed by the liquidators June 24, 2021, in Miami federal court, Standard Chartered Bank (SCB) has alleged that the two companies, Oceanroad Global Services and Holdwave Trading, “took part in laundering the proceeds of a significant, complex, and multinational fraud believed to have been committed against SCB (and other banks) originating with one of its customers, Winsome Diamonds and Jewellery Limited.”
In 2013, Winsome, founded by veteran diamantaire Jatin Mehta, defaulted on approximately $774 million in bank loans, according to a 2021 U.K. court ruling.
Winsome’s 2014 annual report said that 13 companies based in Dubai—all owned by the same person—owed it $875 million and was unable to repay.
Standard Chartered Bank has alleged that the 13 Dubai companies entered into what it called “sham derivative contracts” with a number of companies, including Oceanroad and Holdwave, according to the liquidator’s filings.
In February, the attorneys subpoenaed several U.S. banks, seeking information about whether Oceanroad and Holdwave had any dealings with lab-grown diamond companies Gemesis, Pure Grown Diamonds, and IIA Technologies.
Pure Grown and IIA Technologies have been run by members of Jatin Mehta’s family, but a Pure Grown spokesperson once told JCK that Jatin Mehta has “nothing to do with the company.”
In March, the liquidators also sought information from Frost & Sullivan about the funding for four papers the consultancy did on lab-grown diamonds, including one much-referenced study on their environmental impact.
One Hong Kong–based lab-grown company, PDC Limited, said in a filing that, “Over the course of several weeks from June 14, 2013, through July 4, 2013, PDC borrowed a total of $7.35 million from Glengoyne Financial Holdings Corp. (“GFH”).
It added: “PDC repaid the loans to GFH in several installments in 2015.”
“Upon information and belief, it is alleged that GFH obtained some or all of the funds indirectly from the above captioned insolvents [Oceanroad and Holdwave], which, in turn, are part of a larger investigation into the dealings of Winsome Diamond and Jewellery Ltd. in civil and criminal proceedings in India, the United Arab Emirates, Hong Kong, the United Kingdom, and now, the United States,” it said.
PDC was formerly known as Gemesis HK, according to Open Corporates.
PDC’s attorney declined to speak on a pending court matter. Oceanroad and Holdwave’s liquidators declined comment to JCK. Frost & Sullivan, Pure Grown, and IIA Technologies did not return requests for comment.
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