Report Links Diamonds and Terrorism

By Rob Bates, Senior Editor -- JCK Online, 3/1/2004 2:00:00 AM

Another government report has linked diamonds and terrorism.

A report from the Government Accounting Office (GAO), the investigative arm of Congress, says that terrorist groups like al Qaeda continue to launder money in diamonds.

"Diamonds are easily smuggled because they have high value and low weight and are untraceable and odorless," the report says. "There is limited transparency in diamond flows owing to the complex way in which diamonds move from mine to consumer, the existence of significant data inconsistencies, and the industry's historical avoidance of close scrutiny.'

The report quoted a Belgian law enforcement official as saying "a substantial number of the diamonds traded in Antwerp, the world's largest trading center, are sold on the black market with no transaction records."

It continued: "Most officials and researchers we spoke with recognized a highly probable link between Hezbollah and a part of the Lebanese diamond-trading network in West Africa. … U.S. government officials both within and among agencies remain divided over whether there is sufficient evidence to establish a current link between al Qaeda and the diamond trade."