Two Israelis were last Wednesday arrested at Ben Gurion Airport in the Israeli capital Tel Aviv for allegedly attempting to smuggle in $160 000 worth of non-certified diamonds from the rich Marange diamond fields in Zimbabwe.
One of the suspected smugglers, David Vardi, is a trader on the Israeli Diamond Exchange (IDE).
According to media reports, Israeli police said Vardi had confessed to having obtained the diamonds from intermediaries in Lebanon.
The second suspect was identified as Gilad HaLachmi, who told officials he works as a water consultant in Zimbabwe and was asked by Vardi to carry the diamonds. They were arrested after a customs official stopped HaLachmi, who was attempting to pass through the “nothing to declare” lane at the airport. The rough diamonds were found in his clothing pockets.
On Tuesday, the IDE expelled Vardi for his alleged involvement in the attempt to smuggle the rough diamonds from Zimbabwe.
IDE president Avi Paz, who also serves as president of the World Federation of the Diamond Bourses (WFDB), said the expulsion was conveyed to all other WFDB member-exchanges.
This means that Vardi will not be allowed to trade diamonds at those exchanges.
Many exchanges have a “wall of shame” on which such announcements are posted with pictures of the involved people. This is done to ensure exchange members are notified of bans or other problematic issues.
“The expulsion is not limited by time,” Paz told IDEX Online. “There is no forum for an appeal either.”
Currently in the balance is Vardi’s diamond trading licence, which is in the hands of the diamond controller. If the controller decides to revoke the licence, Vardi will not be allowed to trade in diamonds in Israel.
The valuable stones do not have the official Kimberly Process Certification and were therefore banned by international treaties. The Kimberley Process is the governing body that certifies diamond exporters in order to keep the industry clear of illegal practices,
The rich Marange diamond fields have been the centre of controversy and crime, and virtually none of their diamonds are certified. The recent WikiLeaks cables divulged part of the complex operations between the government and the diamond miners.
The Zimbabwe National Army has been accused of widespread smuggling at Marange. The government forced out a British company African Consolidated Resources that had claimed the diamond fields and began large-scale mining operations. After nationalisation, bands of independent prospectors moved in, resulting in the army’s reported abuse of illegal miners.
Civil society groups have reported hundrends of killings in the diamond mining area.
The Kimberley Process has charged the Zimbabwe government with abusing human rights, and stopped certifying the Marange diamonds.
Despite this, the government has reportedly continued processing and selling them to buyers in China and India, who sell them mainly to Lebanese but also to Russians, Israelis and Belgians, according to Foreign Policy journal reports.
Numerous accounts of violence and diamond smuggling in Chiadzwa by people linked to top Zanu PF officials have also been cited in the past.
Although the diamonds from Chiadzwa are mainly low quality, mostly suitable for industrial sale only – five to 10% are gem quality and these fetch a far higher price.
Most estimates value the diamonds earnings between $1,5 billion and $2 billion annually for the next 10 years at least. Diamonds stockpiled by the government which were currently being sold have an estimated value of $1,7 billion. Vardi was arrested on Wednesday after a courier was picked at random by custom officials at Ben Gurion Airport.
After his arrest, the man admitted to bringing the diamonds from Zimbabwe and disclosed that he was to hand over the contraband at the airport. The person that was to collect the diamonds, reportedly Vardi’s son-in-law, was quickly caught.