Synthetic Diamond Producer Creates Trade Representative Body Prohibits the Use of the ‘S’-WordFebruary 12, 15
Hallelujah! The gem-quality synthetic diamond producers have finally acted in unison by creating a strong joint voice on the challenging issues they face; or so it seems…
The International Grown Diamond Association
A new trade body, the International Grown Diamond Association (IGDA), has a website where it introduces itself as “a not-for-profit organization that will seek to represent and promote the Grown Diamond industry and work towards creating awareness about Grown Diamonds. Founded in Singapore, IGDA seeks to serve as the central point of communication for the industry and a global platform to discuss all issues concerning the Grown Diamond industry and its stakeholders.” (The letters “G” and “D” consistently appear in capitals on IGDA’s elaborate website every time grown diamonds are mentioned.)
The IGDA endeavors “to lead IGDA members and Grown Diamond industry at various global forums (such as industrial, government and retail) and represent the industry on issues that impact the trade.” Actually, the association’s mission statement identifies about 10 different objectives, including to “encourage and monitor ethical industry practices and standards among IGDA members.”
It seems that those industry players, diamantaires, organizations and publications that, from time to time, had suspicions of – or exposed – the apparent misbehavior of some synthetic diamond producers finally have a responsible peer body that will investigate complaints and ensure that its members comply with best practices. This is excellent news.
“IGDA members will be required to abide by and uphold the following prescribed Code of Ethics and Fair Business practices,” states the website.
“It is the duty of every IGDA member to protect the Grown Diamond industry against fraud, misrepresentation, and unethical trade practices. To this effect (a) members shall strive to act fairly, honestly and ethically in all business dealings, provide full disclosure, and accurately and honestly represent their products in all advertising, promotion and sales, and (b) members shall respect and comply with all applicable international, national and local laws, rules and regulations which are relevant to the diamond industry and to the lawful conduct of business generally,” explains IGDA’s website.
At first, I thought that except for congratulating the gem-quality synthetic diamond producers, there wasn’t really a newsworthy story here. But then I got to the fourth and fifth articles in the IGDA’s Code of Ethics and Marketing Guidance.
Prohibition of the Term “Synthetic”
Says the Guidance, “The term ‘Synthetic’ with respect to Grown Diamonds, is technically incorrect and misleading to the consumer. Members of IGDA will not use this term or any variation thereof to describe Grown Diamonds or products set with Grown Diamonds.”
Wow! How can following the United States Federal Trade Commission’s (FTC) rules, enacted to protect consumers and prohibit deceptive advertising, be considered “misleading”? Isn’t this IGDA requirement inconsistent with the other cornerstone of the Code of Ethics, namely that members must adhere to “all applicable international, national and local laws, rules and regulations which are relevant to the diamond industry”?
To reinforce this message, IGDA adds that, “the marketing guidance prescribed by IGDA will take priority for its members and respective Grown Diamond businesses.” The very term “grown diamonds” might well be an infringement of FTC rules. These rules require that the word “diamond” is immediately accompanied, with equal conspicuousness, by the words “laboratory-grown,” “laboratory-created,” or “[manufacturer-name]-created,” “synthetic,” or by some other word or phrase of like meaning, so as to clearly disclose that it is not a natural gem.
As a Gemological Institute of America (GIA) executive recently remarked, “Natural diamonds are grown within the earth.” Whether the term “grown diamonds” by itself can be accepted by the FTC is something IGDA ought to raise with the US authorities. By requiring its members to deviate from the four FTC approved terms, the association is taking on awesome responsibility – and it might create legal vulnerabilities for its members. So who are the IGDA’s members and main office holders?
IIa Technology’s CEO Heads Association
The website immediately takes away any suspense. “Founding president of IGDA, Vishal Mehta, a dynamic professional has been associated with the Grown Diamond industry for over 8 years. Currently serving as the CEO of IIa Technologies, a leading grown diamond technology company, he’s committed to spread awareness about Grown Diamonds and promote their applications across a diverse set of applications and industries.” Vishal, of course, is better known as the son of Jatin Mehta and his wife Sonia and brother to Suraj.
Indeed, this is the very same Jatin Mehta, we should add, who is the founder and promotor of India’s Winsome Diamonds and Jewellery Ltd. (previously Su-Raj Diamonds and Jewellery Ltd.) that is under criminal investigation in India related to the mysterious non-payment of some $1.2 billion by some 13 Dubai customers who had bought diamond jewelry on credit terms. This led Winsome (and related companies) to default on a similar amount of debts to some 15 banks. As Jatin Mehta had personally guaranteed some or all of the Winsome loans, both Winsome and Jatin Mehta have been named willful defaulters by the Indian banking authorities.
Jatin’s personal involvement – and history – in synthetic diamonds is well known, but according to IGDA’s founding president, the key stakeholders in synthetics were and are solely Vishal himself and his mother Sonia.
The ‘Other’ IGDA Founding Members
Still under the heading “Founding Members,” the IGDA website stresses that “IGDA will be also supported in its mission by veterans and diamond industry experts like Richard Gerard, Professor [Devi] Misra, Lisa Bissell among many other distinguished members. They not only bring their knowledge and experience to the association but will be also elemental in guiding every single IGDA member as the Grown Diamond industry expands.”
By our count, the association has four founding members. Lisa Bissell is, of course, president and CEO of Pure Grown Diamonds. Gemesis Inc. promoter (and Vishal’s brother), Suraj Mehta, announced last year that Lisa will spearhead the rebranding campaign of Gemesis Inc. into Pure Grown Diamonds Inc. At the end of the day, IGDA founding member Lisa Bissell ultimately works for the Mehta family. Suraj Mehta is her boss, although, officially, none of the Mehta family members have seats on the Pure Grown Diamonds Inc. board.
Then there is the third IGDA founder, noted professor Devi Misra, who is credited in an article by India’s Livemint, entitled “Vishal Mehta – The Conflict-Free Diamond Maker,” as getting the Jatin Mehta family into gem-quality synthetics to begin with, “after a chance meeting in 2003 between his [Vishal’s] mother and Devi Shankar Misra, then a professor at the Indian Institute of Technology (IIT)-Bombay.”
Says Vishal in the article, “Between 2003 and 2005, Prof. Misra and my mother Sonia Mehta spent time to discuss and assess diamond-growing technologies, what could be done, what were some of the possible directions to research on, etc. During this time, a feasibility study was carried out that resulted in setting up our own unit as it was clearly the only way to work systematically, and with our own customized objectives and applications. A better part of 2005 was spent looking for the right location for this research pilot project,” he is quoted as saying.
There is no mention of his father, Jatin, in the article. The omission seems to be part of the family’s strategy to remove Jatin Mehta from any past, present and future involvement; their history clearly needs to be rewritten. Vishal Mehta explains that Misra, who has an equity interest in IIa Technologies, “joined the company full time in 2010.” So the third IGDA founder and member is also working full-time for the Jatin Mehta Family.
Microwave: The Manufacturer of CVD Growers
The fourth member mentioned is Richard Garard (mistakenly spelled Gerard on IGDA’s website) whose credentials, just as with Bissell and Misra, are not specifically mentioned. Richard Garard is the CEO of the Morrisville, North Carolina-based Microwave Enterprises Ltd. (MWE).
MWE develops, processes and manufactures equipment used in the production of lab-grown diamond materials. The company’s patented microwave technology is used for a range of products, and specifically for the deposition and production of CVD diamonds; it has probably the best technology in the world for mass-production of gem quality synthetics.
Before 2013, MWE was just a supplier to IIa Technologies and Gemesis. Then something changed. “In 2013, the company teamed with one of our customers and the largest producer of lab-grown diamond materials in the world, IIa Technologies,” states MWE’s website. From then on, Lisa Bissell and Richard Garard have something in common: they both “provide the US market with CVD diamond material produced by IIa Technologies,” to quote from MWE’s website. But there is more: the MWE website further reveals that “Microwave Enterprises is pleased to have a relationship with IIa Technologies and the corresponding ability to offer their diamond materials to our customers.” What precisely is the relationship?
IIa Technologies’ Ownership of MWE and Diamtec GmbH
Checking the company registration with the North Carolina Department of the Secretary of State, MWE turns out to have become a foreign-owned entity, probably since June 2012 (when the last change was reported). Over the past few months, DIB has received various reports that MWE had also been acquired by Jatin Mehta or the Mehta family. If this is the case, it is a brilliant move: as the world’s leading and largest producers of CVD gem-quality diamonds, owning or controlling the sources of production – the manufacturers of the growers – would consolidate and strengthen IIa Technologies’ grip on the market.
This would, however, have required considerable financial resources. Such an acquisition could not be “hidden” – certainly not over time. For those who are intimately familiar with Jatin Mehta and his operations, the most fascinating parts of the Vishal Mehta interview in Livemint are the exciting and essential facts that were omitted.
One of these omissions was the establishment of the Diamtec GmbH, which is the research arm of IIa Technologies in Pforzheim, Germany. This German company, established in May 2014, is fully owned by the IIa Technologies Group. The first public information on this German company came from participants at a diamond research convention that took place at the European Centre for Theoretical Studies in Nuclear Physics and Related Areas in Trento, Italy, in November last year.
One of the impressive speakers was Diamtec’s business development director Detlef Hüffer. His revelations will be reserved for another story. What is important, however, is that he publicly confirmed that, in 2013, MWE was acquired by IIa Technologies in Singapore. Thus, the fourth founding member of IGDA, Richard Garard, is essentially also working for Jatin Mehta. There are no other individuals mentioned in the website.
Frost and Sullivan in Support of IGDA Members
To guide IGDA, it has also established an Advisory Panel. So who is on IGDA’s Advisory Panel? At this point, only one company. It is the research company that in the last few years has published several reports on the impact of natural and synthetic diamond mining on the environment and which has shown how consumers have developed good feelings toward synthetic diamonds. Says IGDA, “Frost and Sullivan, a leading consultancy and research outfit, will support IGDA and members with relevant industry knowledge and business strategy consulting.”
Continues IDGA: “For more than 50 years, Frost and Sullivan has been developing growth strategies for the global 1000, emerging businesses, the public sector and the investment community. Frost and Sullivan will be one of the Professional Partner Positions supporting IGDA in its efforts to develop the Grown Diamond industry,” says IGDA. It certainly has.
A Marketing Genius Called Jatin Mehta
There is no doubt that Jatin Mehta is a marketing genius. Moreover, he has – for reasons best known to himself – become “invisible,” working through family members and proxies. However, his fingerprints are on every move that his family or their companies make. Nothing happens “just by coincidence” or “accidentally.”
A few months ago, we disclosed many of the websites Jatin Mehta had “reserved” for future use; we disclosed the outright excellent marketing slogans that he had trademarked with patented logos – all for future use. One such site that we disclosed was the “Better Diamond Initiative (BDI)” website – supposedly a “collection of thoughts, opinions and news based on views, facts and reports published around the world on the diamond and related industry.”
In preparation of this article, we didn’t call IGDA or IIa Technologies. For reasons known only to them, they have stopped talking to us and don’t respond to media inquiries. The main reason for us not asking them is different altogether. As soon as an investigative journalist discovers a website, link, or network registration that links directly to IIa Technologies, it gets changed or removed. In Singapore, in that respect, their alertness is 24/7.
For instance, when the website http://www.growndiamonds.org/ was discovered, it was quickly closed down. We trust that the same fate will befall on the IGDA website http://igda.joji.com.sg/about-igda/ or http://igda.joji.com.sg/members/code-of-ethics/.
The IIa Technology computer experts have made the website invisible for either Google search engines or Google archives. For a genuine and legitimate non-profit trade association, it seems like an odd step. Undoubtedly, they want to time the “launch” to take place at a time and place convenient to them. They do what they have to do – and the press does what it is supposed to do as well.
We have followed the website now for many months, but haven’t seen a formal announcement. We are not aware of a single synthetic diamond producer who has joined the Association so far. Having it dominated by IIa Technologies will certainly create some competition and legal issues.
Just think about how ingenious all of this is: if the IGDA wants all producers (essentially all of Jatin Mehta’s competitors) to label their output as “Grown Diamonds,” he has miraculously positioned his own product in a distinct, competitive reputational and marketing advantage. All the competitors’ synthetic diamonds are just ordinary Grown Diamonds. He, however, is the only one to have Pure Grown Diamonds… You have to give him credit – he has, perhaps, created the “Forevermark” of synthetics!
The Gemesis Connection
In the Livemint article mentioned above, reference was made to the 2012 discovery of some 1,000 undisclosed synthetic diamonds sold and invoiced as natural diamonds. (DIB previously reported that these stones were sold by Winsome Diamonds and Jewellery Ltd.’s wholly owned Su-Raj Diamonds in New York to an Antwerp dealer.) Livemint recalls the media reports that “linked these stones to Florida-based Gemesis Diamond Company.” In various company publicity, and in the interview, this fraud is referred to as “the incident.” (In some “friendly” articles, it is even argued that it never happened.)
“After the incident, the [Gemesis] firm was bought out by an entity controlled by Vishal Mehta and his mother, and its manufacturing facilities relocated to Malaysia,” writes Livemint. Says Vishal, “On the group level, we did acquire that [Gemesis] technology and transfer it to our facility in Malaysia.”
Technically and legally, Vishal is correct: through a reverse takeover, a special purpose vehicle Gemesis Acquisition Corporation merged with and into Gemesis Diamond Company. The greatly diluted minority shareholders of Gemesis were indeed invited to sell their shares completing Mehta’s buy-out of Gemesis. However, Vishal Mehta apparently had forgotten that his own father, Jatin R. Mehta, had bailed out the Florida-based Gemesis in January 2010, when India’s Su-Raj Diamonds and Jewellery, through Vishal, committed to invest a sum of $8.4 million over a period of three years in Gemesis.
In return, in January 2010, the family received 50.1 percent of the company’s equity on a fully diluted basis. Then Jatin Mehta assumed hands on control making all major decisions – and this was over two years before the so-called “incident” took place. Subsequently, the IIa Technologies, on the group level, rebranded Gemesis as Pure Grown Diamonds Inc., which is now a distributor of Type llA gem-quality grown diamonds in the United States.