US authorities are investigating a massive theft of jewelry from a Brink’s armored vehicle in California last week.
The truck was transporting goods to the International Gem & Jewelry Show in Pasadena, California, exhibition director Brandy Swanson told Rapaport News on Tuesday. The victims were 16 to 18 vendors. The contents included “high-end jewelry, watches and diamonds,” Swanson said.
The executive estimated the losses at $100 million to $150 million. Brink’s put the value at less than $10 million, according to media reports — a discrepancy explained by the practice of vendors underinsuring goods, Swanson noted.
“They all have invoices and paperwork to show the higher value,” Swanson said.
The theft occurred early on July 11, according to a spokesperson for the Federal Bureau of Investigation (FBI) in Los Angeles, which is investigating the case together with the Los Angeles County Sheriff’s Department.
On that day, deputies from the Sheriff’s Department station in Santa Clarita, California, were called to the “Flying J” rest stop and gas station in the mountain community of Lebec in response to the burglary of a cargo container.
They “learned that several pieces of jewelry and gemstones valued at several million dollars were stolen from a locked ‘Brink’s’ tractor trailer by unknown suspects,” the department said Monday in a report.
“According to the information the customers provided to us before they shipped their items, the total value of the missing items is less than $10 million,” Brink’s said in a statement quoted in the US media. “We are working with law enforcement, and we will fully reimburse our customers for the value of their assets that were stolen, in accordance with the terms of our contract.” The company did not respond to a request for comment from Rapaport News.
The Baselworld fair has received much criticism in recent years, but one of the final shows before its public implosion appears to have facilitated a diamond deal that counts among the biggest in history.
Antwerp-based manufacturers Taché and Samir Gems came to the March 2018 exhibition with the exquisite Lesotho Legend, a 910-carat, type IIa diamond they had bought together from Gem Diamonds for $40 million earlier that month. At the time, jewelers such as Graff and Harry Winston dominated the big-stone market. Displaying the massive rough at the prestigious Swiss event could help drum up broader interest in the category, Taché and Samir believed.
“We felt that the market was a bit saturated between one or two players,” says Jean-Jacques Taché, managing director for sales at Taché, from his office in Tel Aviv, Israel. “So we thought, let’s bring it to Basel, let’s…showcase the [rough], and let’s see the reactions.”
Plenty of visitors wanted selfies with the stone, which came from the famous Letšeng mine in Lesotho. Some suggested buying a sliver of the piece — polished of, say, 5 to 20 carats, Taché recalls. However, “none of them were really committed at that point to enter into a venture.”
The exception was Van Cleef & Arpels, a Richemont-owned luxury brand that, Taché explains, had been somewhat pulling back from big stones in recent years.
“From the minute they saw it, [Van Cleef] started to talk about the idea that they had,” the executive adds. The timing was perfect: The luxury brand had just finished a ruby collection and was seeking a new project on which to spend a few years. “Sometimes you need a lot of things to happen at the same time in order to make it a success.”
The buying executive representing Van Cleef needed approval from Nicolas Bos, the brand’s CEO, and the Richemont team. Not long after the event, Taché, Samir and Van Cleef signed an agreement calling for the jeweler to buy the final polished. The condition was that the finished goods met the French house’s high quality criteria.
Long wait
Only this month did Van Cleef reveal the finished jewelry, more than four years after the initial pitch. The result was a unique collection of 25 Mystery Set jewels featuring 67 D-flawless diamonds. The largest is an oval, 79.35-carat stone that takes pride of place in a necklace called Atours Mystérieux, meaning “mysterious attire.” The smallest is 0.29 carats. The parties have not disclosed the polished sale price.
Taché and Samir both took heavy risks by splurging on the rough back in 2018. (Gem Diamonds publicly named Samir as the buyer: As is often the case, a miner only invoices one entity, but the purchase was really a 50:50 partnership.)
The two companies have a long-standing collaboration, having also bought the 341.9-carat Queen of Kalahari together from Lucara Diamond Corp. a few years earlier. They sold that polished to Chopard. Samir has its expertise in purchasing large rough stones; Taché specializes more in relationships with the top jewelry brands.
“We’re the most successful Jewish-Indian partnership on the market, by far,” says Taché.
They outsourced the cutting and polishing to Diamcad, an Antwerp firm that also manufactured the Lesedi La Rona for Graff. The goods went for grading at the Gemological Institute of America (GIA) in New York, where all the stones received Diamond Origin Reports stating that they were from the Lesotho Legend.
Van Cleef took delivery of the polished as each stone was ready between January 2019 and March 2020, Taché notes. However, Covid-19 delayed the launch, as Van Cleef had been hoping to hold roadshows.
Jean-Jacques Taché and Anjal Bhansali
Quality over size
The manufacturers agreed to include Van Cleef throughout the process, including in the planning and design. The Taché and Samir teams even traveled with Van Cleef’s Bos to Lesotho in May 2019 to experience the Letšeng mine and learn about the local community there.
The brand would accept only flawless goods, so quality became a higher priority than size. The planning process, which took about seven months in 2018, saw the parties review around 180 possible combinations of outcomes. None of them included any “monster” stones, they note.
“Instead of 67 stones, you could also have a model with probably 12 pieces only, but [it would have been] much less interesting in terms of creation,” Taché continues.
There were other complicating factors. Van Cleef tends to avoid round and heart-shaped diamonds. It also wanted matching pairs: “Practically every stone in this collection between 10 and 30 carats is a couple,” he points out.
“If we went for something which was 100-carats-plus, we would have had to go into the VS range,” comments Antwerp-based Anjal Bhansali, managing director at Samir. The team even broke up a stone of roughly 75 carats into two matching stones weighing around 30 carats each, Bhansali reveals.
Boost for big stones
The manufacturers hope the collection will succeed in reinvigorating the large-diamond sector, expanding it beyond the traditional two giants.
“The goal is to create more awareness for big stones in the market and to bring in new players,” Taché concludes. “We started it with Chopard. We [are continuing] this now with Van Cleef.”
It’s unclear whether the Basel show will ever return. However, everyone involved in the Lesotho Legend project will agree that the 2018 edition was well worth it.
Luxury jeweler Graff Diamonds pays $7.5 million worth of Bitcoin in ransom to Russian hackers
A damaging ransom attack has forced luxury British jeweler Graff Diamonds to pay $7.5 million worth of Bitcoin to a group of Russian hackers, a London lawsuit revealed.
In case of failure to pay, a group of hackers threatened to leak the private data of jeweler’s high-profile clients. Graff is known for its famous clientele, including Oprah Winfrey, the Sultan of Brunei, and royalty from the Middle East.
Graff is suing its insurer, Travelers, for refusing to cover the ransom, which is how more information about the hack came out. Graff is maintaining that the payout should have been covered by insurance.
The hack happened in September 2021, with ransomware group Conti taking responsibility and leaking data. The attack was somewhat unusual, with Conti issuing an apology to Graff’s clients from Saudi Arabia, UAE, and Qatar while also threatening to leak more data.
“We found that our sample data was not properly reviewed before being uploaded to the blog,” the hackers wrote back in October. “Conti guarantees that any information pertaining to members of Saudi Arabia, UAE, and Qatar families will be deleted without any exposure and review. Our Team apologizes to His Royal Highness Prince Mohammed bin Salman and any other members of the Royal Families whose names were mentioned in the publication for any inconvenience.”
Among the leaked data was private information on celebrities like David Beckham, Oprah Winfrey, and Donald Trump, The Daily Mail reported last year.
In November, Graff ended up paying half of Conti’s initial demand, which was $15 million worth of Bitcoin. The cryptocurrency was transferred to a Bitcoin wallet at a time when the digital currency was around its all-time high of $69,000.
“The criminals threatened targeted publication of our customers private purchases,” a Graff spokesperson said. “We were determined to take all possible steps to protect their interests and so negotiated a payment which successfully neutralized that threat.”
According to the spokesperson, Graff is “extremely frustrated and disappointed by Travelers’ attempt to avoid settlement of this insured risk. They have left us with no option but to bring these recovery proceedings at the High Court.”
Graff was founded in 1960 by billionaire Laurence Graff, who is now worth $5.8 billion, according to the Bloomberg Billionaire Index.
“The government has approved amendments to the Tax Code, said Deputy Finance Minister Alexei Moiseev
Alrosa Rough Diamond
According to media reports quoted by Rough & Polished, Russia’s Deputy Finance Minister Alexei Moiseev said during the Cheboksary Economic Forum that the government of the Russian Federation “approved the introduction of a zero VAT rate on rough and polished diamonds.”
“The government has approved amendments to the Tax Code, which provide for the introduction of a zero VAT rate on rough and polished diamonds,” he said on the sidelines of the Cheboksary Economic Forum.
This decision, he reportedly added, “will facilitate growth in demand for investment diamonds within Russia.”Credit: Alrosa
ussia condemned what it called a push to “politicise” its diamonds over the conflict in Ukraine and said attempts to question its compliance with the international diamond certification scheme were “totally unfounded” and “far-fetched”.
The Kimberley Process, a coalition of governments, the diamond industry and civil society responsible for certifying diamonds as conflict-free, is split over a push by Ukraine and others to expand its definition of conflict diamonds to include those funding aggression by states.
The KP Civil Society Coalition (CSC) and some member states sought to discuss whether Russia’s diamonds were helping to fund the war in Ukraine during a KP meeting in Botswana last week.
“The Russian Federation absolutely condemns the orchestrated attempts of CSC, backed by absolute minority of some Western participants, to politicize the work of the Kimberley Process by deliberately distorting or even openly replacing its basic principles,” Russia’s finance ministry said in an emailed statement. It did not specify which principles it felt were being distorted or replaced.
The CSC did not immediately respond to an emailed request for comment.
The KP defines conflict diamonds as those that fund rebel movements seeking to overthrow legitimate governments, a narrow definition that many have sought to widen since the KP was founded in 2003.
Russia, which was KP chair last year, has “championed” work on revising the definition of conflict diamonds for the past five years, the finance ministry said, and it is committed to continuing talks on the definition.
“We therefore call on our opponents to refrain from further speculative accusations, abstain from political demagoguery and concentrate on the substantive work of the KP,” the finance ministry said.
The KP makes all decisions by consensus and the rift over Russia and Ukraine could jeopardise its effectiveness.
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China has joined Russia in opposing an effort to redefine conflict diamonds to include those sold by individual nations, as a rift between Western and pro-Russia nations jeopardizes the process for certifying rough diamonds as conflict-free.
Ukraine, Australia, Britain, Canada, the European Union, the United States and civil society groups were pushing to place Russia on the agenda at this week’s Kimberley Process (KP) meeting in Botswana and to broaden the KP’s definition, under which only gems funding rebel movements are “conflict diamonds”.
Russia, the world’s biggest producer of diamonds, has said the situation in Ukraine has “no implications” for the Kimberley Process.
China agrees that the Ukraine issue falls outside the scope of the KP, the country representative told the meeting, according to three sources. China joins Belarus, Central African Republic, Kyrgyzstan and Mali in backing Russia’s stance within the body, which seems unlikely to come to any agreement.
“It’s clear that this is posing really an existential crisis for the Kimberley Process,” said Hans Merket, a researcher at Belgian non-governmental organisation IPIS, who is a member of the civil society group.
“It has become impossible to even discuss the KP’s problems and shortcomings, let alone that there would be any room for convergence on how they can be addressed.”
China’s KP representatives did not respond to an emailed request for comment.
The KP certification scheme, designed to eliminate the trade in so-called “blood diamonds”, was set up in 2003 after devastating civil wars in Angola, Sierra Leone, and Liberia, which were largely financed by the illicit diamond trade.
The Kimberley Process Civil Society Coalition and some member states have been arguing to broaden that definition for years, but it is difficult to do as the KP makes decisions by consensus.
Jacob Thamage of Botswana, the current KP chair, said that more participants now believe reform is needed.
