De Beers
[Image Courtesy: PR Web, De Beers]

De Beers is amidst another shocking diamond scandal. Conrad Benn, senior manager in the valuation department of South African Diamond and Precious Metals regulator, who was fired last month by the regulator after he was suspended last April, has applied in the High Court challenging the regulator’s decision and accusing his boss Levy Rapoo and De Beers of obstructing his investigation.

Under local laws, if De Beers can show that at least 40% of its sales exceeding 5 billion Rand benefits local companies then it is can sell its diamonds overseas sans any permission requirements. One of De Beers Sightholder – Erez Deleyot, an Israeli businessman, had submitted an affidavit stating that De Beers, Swiss based Israeli-owned Steinmetz Group and Levy Rapoo – regulator’s chief executive have colluded and are stealing from South Africa. When Rapoo asked Benn to verify this claim, Benn found that of the 11 local companies benefited from De Beers, major share was to a single off-shore company and De Beers was not complying with the laws.

De Beers
Beny Steinmetz [Image Courtesy: The Guardian]
35% of the 40% gross value to local beneficiaries was sold to Ascot Diamonds, owned by major diamond businessmen Beny Steinmetz and consisted of substantial portion of ‘exceptional stones’. Benn said that these large diamonds were of good color and clarity and best of the production cycle. To investigate this further, he had repeatedly contacted De Beers authorities but instead of co-operating they wrote to the regulator accusing Benn of sharing confidential information to third party resulting in ENS Forensics, a local law firm, to search his house and seize his laptop. Benn has told the High Court that the disciplinary committee in which he was fired, was chaired by GJ Fourie, who was appointed by the same local law firm – ENS Forensics.

Though this is not the first time that De Beers has been surrounded by scandals and controversies. Recently, a beneficiation scandal was uncovered in Botswana where De Beers used loopholes in the agreement to smuggle diamond roughs out of the country for processing instead of processing them locally, thus defeating the very purpose of beneficiation. Several local processing units that had started on the basis of beneficiation are shutting shops and thousands of jobs lost.

De Beers
[Image Courtesy: Born2Invest, De Beers]
De Beers’ clout scares many industry stakeholders and its domination and influence causes unrealistic gem prices. St. Antoninus Institute has termed De Beers as ‘The most unethical corporation in the world’.

Instead of facing and solving its griming reality, De Beers has turned to such malpractices together with its revival of ‘A diamond is forever’ campaign in hope that gullible people will be fooled again for centuries, forever.

 

Leave a Reply