Massive diamond fraud uncovered

Summary

Police in Antwerp are investigating a massive diamond fraud in which a Belgian-Lebanese family smuggled diamonds worth an estimated €1.3 billion over the course of several years. The family has not been named, and most of the income from the scheme is thought to have been exported to Lebanon.

Police in Antwerp are investigating a massive diamond fraud in which a Belgian-Lebanese family smuggled diamonds worth an estimated €1.3 billion over the course of several years. The family has not been named, and most of the income from the scheme is thought to have been exported to Lebanon.

The investigation started with a warning from the state security service that the family had connections with known dealers in illegal diamonds. The diamonds are brought into Antwerp and the takings then exported, both undocumented, to evade huge sums in tax. The illegal diamonds, including stones originating in conflict zones – the so-called “blood diamonds” – were mixed with legal diamonds and the whole shipment certificated as “mixed origin” by the industry’s system of Kimberly certificates, which are supposed to guarantee the origins of any stone. The family managed to get around the Kimberly system by passing the stones through the United Arab Emirates and Switzerland before bringing them into Belgium. The profits, meanwhile, were laundered by means of false invoices and fake bookkeeping.

Investigators have so far found €4 million worth of diamonds – a fraction of the quantities concerned, most of which is likely now out of the reach of the authorities.

Smaller scale beer fraud

In another fraud case, hundreds of cafes in East and West Flanders can expect a visit from the tax authorities in connection with a scheme uncovered in 2010 involving a drinks wholesaler from Waarschoot, East Flanders. The trader regularly sold vats of beer under the table to café owners, who then sold the beer on without having to pay VAT.

The man made a deal with the tax authorities at the beginning of the year in which he paid €15 million in back taxes and penalties. He also gave up the names of 800 of his customers. According to trade federation Horeca Vlaanderen, the costs could mean the end of many of the businesses affected.

Massive diamond fraud uncovered

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