CBI and ED pursue Winsome Diamonds case against Jatin Mehta

What the Record Shows

The Winsome Diamonds and Jewellery matter, one of the older large bank-fraud investigations still working through the system, remains at the allegation stage more than a decade after the underlying default. The Central Bureau of Investigation (CBI) and the Enforcement Directorate (ED) have pursued the case against the group and its promoter, Jatin Mehta, who has been abroad since 2016, and there has been no conviction.

The shape of the CBI's case is set out in an official court record. Per the Bombay High Court's order dated 15 November 2022 in Hasmukh Lilachand Shah vs CBI, the agency alleges that, by a criminal conspiracy running from around 2009 to 2013, Canara Bank was misled in the sanction and disbursal of working capital through misrepresentation, and that the accused availed financial facilities by submitting standby letters of credit. That order records an alleged defalcation of about Rs 150 crore in respect of the specific facilities before the court, and describes Jatin Mehta as the promoter, based abroad, under whom the applicant had worked.

Across the wider investigation, the CBI has registered a series of cases and filed multiple chargesheets since 2014, and the ED has registered several Enforcement Case Information Reports and filed a prosecution complaint. These are allegations pending trial; no accused in the matter has been convicted.

How It Worked

The mechanism, as investigators describe it, was built on trade finance rather than on public deposits. Winsome Diamonds and its associate Forever Precious Jewellery bought gold from overseas bullion banks against standby letters of credit issued by a consortium of Indian banks led by Canara Bank, meaning the Indian banks stood as guarantors for payment.

The gold was then processed and exported to a set of buyer companies located in the UAE. Per the investigation, those overseas buyers defaulted en masse on payment, which caused the Indian guarantees to be invoked and the resulting loss to fall on the Indian public-sector banks that had backed the letters of credit. Investigators allege that the overseas buyers were not independent commercial counterparties: per the investigation, all of the UAE buyer companies were controlled through power of attorney by a single individual, an arrangement the agencies say points to the transactions being orchestrated rather than arm's length. This report does not name that individual, who is described in investigation material and is not the subject of any concluded finding.

The procedural history is long. The default surfaced around 2013, the CBI and ED opened their investigations from 2014, and Jatin Mehta left India in 2016; reporting notes that he had acquired citizenship of St Kitts and Nevis, with which India has no extradition treaty. The Bombay High Court's 2022 order gives a sense of how slowly the trial is moving, noting a very large witness list and that several co-accused had by then been released or discharged.

Who Lost Money

The losses in this case fell not on a class of retail investors but on lenders. Reporting of the investigation puts the total alleged loss to the consortium of Indian banks, led by Canara Bank alongside others including Standard Chartered, at about Rs 7,000 crore, a figure that varies across sources and should be read as an estimate rather than a settled number.

Because the exposure sat with public-sector banks, the ultimate cost is borne indirectly by the banking system and, through it, by depositors and taxpayers who stand behind that capital. Unlike a deposit scheme with named individual victims, here the harm is diffuse, which is part of why such cases attract less public attention than their scale would suggest.

Recovery has been limited and slow. With the principal accused abroad and assets spread across jurisdictions, the amounts realised through attachment and liquidation are a fraction of the alleged loss, and Winsome Diamonds itself has been subject to winding-up proceedings before the courts. Readers can follow related recovery and enforcement matters through the enforcement archive.

Where It Stands Now

The case remains live and unresolved. The ED's application to declare Jatin Mehta a Fugitive Economic Offender, filed in 2019, was still pending before a Mumbai court as of the latest public record; he has not been declared an FEO, and a pending application is not a determination. Reporting in early 2026 indicated the ED was examining whether to move similar applications against members of his family for non-appearance, a step the agency was said to be considering rather than one already taken; nothing in that reporting amounts to a finding against them.

On the criminal cases, the trial continues, with the Bombay High Court record noting the scale of the evidence and that co-accused have variously been released or discharged. That last point matters: an accused named in a chargesheet may ultimately be discharged or acquitted, and several in this very matter already have been.

The CBI chargesheets, the ED's prosecution complaint and the pending FEO application contain allegations, not findings of guilt; the accused are presumed innocent until proven guilty, and due process continues.

What It Means

The Winsome matter is a study in how a cross-border trade-finance structure can convert a private commercial default into a public loss. When a bank issues a standby letter of credit, it substitutes its own creditworthiness for the buyer's; if the underlying trade collapses, the guarantee is called and the bank pays. That is exactly how the instrument is meant to work, which is why the integrity of the counterparties and the genuineness of the trade matter so much to the lender.

The wider lesson sits with process rather than with any individual. Cases of this size routinely take a decade or more, absconding accused can stall extradition through convenient citizenship, and the gap between a headline loss figure and the sums actually recovered is usually vast. Tools such as the Fugitive Economic Offenders Act were created precisely to address accused who place themselves beyond the reach of the courts, but they operate through their own judicial process that must run its course. Related enforcement actions, including a deposit-scheme arrest and a tender-commission chargesheet, show the same pattern of slow-moving proceedings that the courts continue to work through.

FAQ

Does this mean the people named are guilty?

No. The CBI chargesheets, the ED's prosecution complaint and the pending FEO application contain allegations, not findings of guilt. Jatin Mehta and the other accused have not been convicted and are presumed innocent until proven guilty. The Bombay High Court record itself notes several co-accused have been released or discharged.

Has Jatin Mehta been declared a fugitive economic offender?

Not as of the latest public record. The ED's 2019 application remains pending before a Mumbai court. Being declared an FEO would require a separate judicial finding that has not yet been made.

What do the agencies allege happened?

Per the CBI, as recited in the Bombay High Court order, the accused allegedly misled Canara Bank in the sanction and disbursal of facilities through misrepresentation and standby letters of credit, with gold bought against Indian guarantees shipped to overseas buyers that then defaulted.

How large is the alleged loss?

Reporting puts the total alleged loss to a consortium of Indian banks at about Rs 7,000 crore, a figure that varies across sources. The Bombay High Court order in a related matter refers to an alleged defalcation of about Rs 150 crore on specific Canara Bank facilities.

Where can I read the official record?

The Bombay High Court order dated 15 November 2022 in Hasmukh Lilachand Shah vs CBI, available on indiankanoon.org, sets out the CBI's allegations and the procedural position. That order is the primary official source for this report.

This report is based on the Bombay High Court order dated 15 November 2022 and subsequent case reporting reviewed on 1 August 2026.