De Beers has rebuffed allegations in the media that it sold Russian diamonds in breach of US sanctions.
On Thursday, luxury publication Glitz.Paris reported that De Beers had “sold stones of Russian origin in the US” last year. It also claimed the company “bought diamonds in 2022 from the Russian firm Alrosa via an Israeli company.” Over the weekend, Botswana newspaper Sunday Standard cited the allegations in a front-page story.
“Let us be clear — this allegation is not true,” De Beers said in a statement Sunday. “De Beers only sources diamonds discovered in Botswana, Canada, Namibia and South Africa, or from select companies that adhere to our strict and third-party audited sourcing policy. Following the start of the war, we removed Russia from our third-party sourcing list. We do not source diamonds from Russia.”
The “shady deals” threaten to “taint Botswana diamonds” and might affect ongoing negotiations between De Beers and the Botswana government, Sunday Standard asserted.
De Beers’ Forevermark consumer brand “conducted at least 120 transactions of Russian diamonds with customers in which the stones were destined for the US market,” Sunday Standard reported, citing the paywalled Glitz.Paris article. These stones ranged from 0.19 to 0.27 carats, had VS1 clarity, and carried insurance valuations of $227,000 to $366,000, the newspaper continued.
De Beers signed “several contracts” with Alrosa, Russia’s partially state-owned diamond miner, in recent years, with three of them dated February 21, 22 and 23, 2022, according to the same report. Russia invaded Ukraine on February 24, 2022 — the same day the US sanctions went into effect. It’s unclear if the reports were alleging any deals took place after this date.
Some of the alleged purchases were via Israel-based diamond manufacturer and De Beers sightholder Dalumi Group, the report claimed — a fact that Dalumi also denied.
“Dalumi Group ceased buying Russian diamonds from Alrosa on February 22, 2022,” Dalumi managing director Rafi Yerushalmi said in a statement to Rapaport News on Sunday. “Furthermore, Dalumi Group confirms that it has never sold Russian polished to the De Beers Group.”
The claims raise the stakes in the De Beers-Botswana negotiations, according to Sunday Standard, since the government has demanded that the country’s diamonds be marketed separately from De Beers aggregated goods as “Botswana diamonds.” At present, the bulk of rough coming from De Beers’ mines in Africa and Canada goes through aggregation before reaching the market.
“It is no secret that we have been the subject of a number of headlines in Botswana over the past several months,” De Beers said in its statement on Sunday. “While those stories were distortions, this particular story is dangerous. Beyond De Beers, it suggests to consumers that the natural diamonds they buy, a significant percentage of which come from Botswana, are tainted. This is not true, but in an attempt to discredit De Beers, the article risks damaging much more.”
On March 11, 2022, following the US’s ban on imports of Russian diamonds, De Beers released a statement saying that “every diamond that De Beers Group sells is discovered at one of our mines in Botswana, Canada, Namibia or South Africa.”
The current version of that statement on the De Beers website reads: “Every diamond discovered by De Beers Group comes from one of our mines in Botswana, Canada, Namibia or South Africa.” A note accompanying it says that the wording was “amended for accuracy” on March 23, 2022.
While De Beers only sells rough from its own mines, it sources diamonds from third parties for Forevermark and De Beers Jewellers, its consumer brands.
This is not the first time De Beers has moved to refute reports about it in Botswana. In November 2022, it denied a Sunday Standard article saying the government might “ditch” the mining company.
Image: A diamond engagement ring at a De Beers Forevermark store in Gaborone, Botswana. (Ben Perry/Armoury Films/De Beers)