Diamond trading is a source of revenue for al Qaeda, the terrorist organization suspected of masterminding the Sept. 11 attacks on the United States, the Washington Post reported recently. A Nov. 16 article in the Wall Street Journal cited the tanzanite trade as another source of al Qaeda funding, and shortly after that article appeared, QVC Inc., an international leader in electronic retailing, became the first major retailer to suspend sales of tanzanite.
The Post story, quoting European and U.S. intelligence officials, said that “there is a strong indication that al Qaeda, perhaps anticipating its accounts would be frozen after the Sept. 11 terrorist attacks in the United States, sought to protect its money by sinking it into gemstones, a commodity that can be easily hidden, holds its value, and remains almost untraceable. … U.S. and European intelligence officials … realized only recently how important the diamond flow was to fund al Qaeda and other terrorist organizations.”
The story accused two Lebanese dealers based in Antwerp, Aziz Nassur and Sammy Ossailly, of working with operatives in Osama bin Laden’s terror network to buy conflict diamonds from the Revolutionary United Front, the Sierra Leone rebel group that funds itself with diamond sales.
“I now believe that to cut off al Qaeda funds and laundering activities you have to cut off the diamond pipeline,” said a European investigator quoted by the paper. “We are talking about millions and maybe tens of millions of dollars in profits and laundering.” The article also linked the Lebanese traders with Islamic terrorist group Hezbollah.
A member of the United Nations panel on diamond sanctions quoted by Reuters said that it was “common sense” that terrorists would use diamonds to launder money.
The RUF, now participating in the Sierra Leone peace process, denied dealings with al Qaeda terrorists, according to the Associated Press.
“We’ve known for a long time that shady operators, including an organization the State Department already calls a terrorist group—the Revolutionary United Front—were earning hundreds of millions of dollars a year from this blood trade,” said Rep. Tony Hall (D-Ohio). “If this report is accurate, we’ve also known exactly who was collecting some of that money: Osama bin Laden.”
The diamond-terrorism link has attracted notice ever since gems were mentioned—briefly—as a source of terrorist funds in the U.S. embassy bombing trial. (The transcript of this section can be seen at www.ccc.de/mirrors/cryptome.org/usa-v-ubl-09.htm.)
There also is an alleged link between terrorism and an obscure California diamond mining company. As part of its crackdown on terrorism, the government recently froze the assets of Yassin A. al-Kadi, a member of the board of directors of Global Diamond Resources, a La Jolla-based firm that funds diamond mining in South Africa, press reports say.
Investigators charge that al-Kadi provided $3 million to bin Laden and his al Qaeda organization. He is also suspected of funneling funds to terrorist groups like Hamas. Al-Kadi has denied the accusation. “Nothing has been given to bin Laden whatsoever. This is nonsense,” he told the Washington Post during an interview in Jeddah, Saudi Arabia.
Company chairman Johann de Villierrs did not return a call from JCK. However, he told the San Diego Union-Tribune, “I’m concerned that he may be involved in that, though I seriously doubt it, knowing him.” He said he had met al-Kadi only three or four times.
Tanzanite Linked to al Qaeda; QVC Suspends Sales. The Wall Street Journal reported in its Nov. 16, 2001, edition that there is a link between the tanzanite trade and Osama bin Laden’s al Qaeda terrorist network.
According to the WSJ report, tanzanite gems are smuggled out of Tanzania through the Kenyan city of Mombasa, described in the story as a stronghold of al Qaeda sympathizers. From Kenya the stones go to Dubai, part of the United Arab Emirates. Dubai is described in the story as a center for money laundering and underground cash transfers, and it’s depicted as a favorite haven for al Qaeda’s business interests.
The Federation of Small Scale Miners Association of Tanzania (FEMATA/SSM), a nonprofit organization with more than 500,000 members, stated that “unfortunately for Tanzania, tanzanite small-scale miners, and others, recent investigations have indeed uncovered businesses and business people with alleged ties to terrorist groups.”
According to Lorraine Braden of Pittsburgh-based Contemporary Global Enterprises (CGE), SSM’s U.S. emissary, many of those with ties to terrorism have been detained and questioned by Tanzanian law enforcement authorities and others, including the FBI.
SSM announced on Oct. 7, 2001—before the WSJ article was published—several measures aimed at breaking tanzanite’s link to terrorism, including issuing “Certificates of Origin.” Procedures to ensure transparency and establish a paper trail for tanzanite trading already are in place. All dealers in minerals, including brokers, must have a properly registered company and license, and goods must be exported through proper channels that issue documentation. Documents include an export permit, export receipt, company invoice, customs clearance, and freight forwarding documentation.
QVC, which suspended all worldwide sales of tanzanite jewelry on its Web site, TV programs, and retail outlets in the United States and abroad immediately after the WSJ article appeared, is working with government agencies to get more definitive information. How long the suspension of tanzanite sales lasts “depends on what we learn,” says Bonnie Clark, vice president of public relations for QVC.
Specifically, QVC pulled 120 different pieces of tanzanite jewelry (retailing from $39.50 to $5,000) and canceled outstanding orders. The company declined to say how much business it does annually in tanzanite jewelry. However, all jewelry lines (including gold) account for 31% of its programming.
QVC, based in West Chester, Pa., does more than $3 billion in business annually. Founded in 1986, it broadcasts live 24 hours a day, 364 days a year, and introduces 300 new products every week to viewers in 79 million U.S. households, including 96% of all U.S. cable homes. It also reaches more than 35 million homes in Germany and Great Britain through satellite broadcasting. In 1996, it launched its Internet shopping site.