GOVERNMENT has blacklisted prominent diamond dealer, Jamal Ahmed, from participating in the Minerals Marketing Corporation Of Zimbabwe (MMCZ) diamond auction as authorities sweat to bust a diamond-buying syndicate influencing prices on the auction , the Zimbabwe Independent has established.
This comes after the country’s diamond sector was rocked by a scandal involving officials from the Zimbabwe Consolidated Diamond Company (ZCDC) and MMCZ accused of establishing a notorious cartel that has been manipulating diamond trade.
This, according to well-placed diamond sources, resulted in one buyer, Jamal Ahmed, a Lebanese, allegedly exploiting the market.
The Independent understands that the government wielded the axe on the diamond dealer and threatened him with arrest and deportation.
“Jamal has been the prominent buyer of diamonds at the auction due to his competitive prices. But there are indications that diamond prices were leaked to him before the auction. He had inside information.
“The calls to bring order on the diamond auction grew louder forcing the government to wield the axe on the diamond dealer. He was told to stop dealing with MMCZ forthwith or risk jail time and deportation,” the source said.
Sources further noted that there was the possibility of collusion at the diamonds auction resulting in Jamal enjoying a monopoly on the country’s diamonds.
Jamal has over the years been accused of enjoying the assistance of MMCZ top officials as he bought most of the country’s diamond parcels.
The Lebanese has denied the allegations arguing that he was a legitimate buyer who offered competitive bids.
There are also allegations that ZCDC evaluators and MMCZ marketers have also been part of a syndicate which has been lining up its pockets through leaking diamond prices to prospective buyers and eliminating competition.
An internal investigation was launched at ZCDC last year which resulted in the dismissal of one senior employee (name supplied) on allegations related to leaking prices to buyers.
“There have been allegations around the existence of a syndicate that has been leaking prices to buyers and this saw only one buyer outbidding the others at every auction.
“In the past, the auction used to attract a lot of buyers including those from Belgium but the latest situation created disharmony among the buyers. This has resulted in ZCDC going overseas to engage buyers,” another source said.
It is alleged that senior government officials have on several instances raised concerns over the relationship between Jamal and MMCZ which could have been premised on suspected “corrupt conditions”.
The search for buyers by ZCDC, has created friction at the MMCZ, who argue that they have the mandate to market the diamonds.
MMCZ general manager Tongai Muzenda did not respond to questions sent to him via SMS and WhatsApp. Mines and Mining Development minister Winston Chitando also failed to comment.
Jamal was available for comment but his business associate who spoke on condition of anonymity confirmed that the diamond dealer was blacklisted by the government.
“Going forward, Jamal is out of the picture. You need to check the prices that the new buyers are going to offer. This was a clear case of victimisation,” said Jamal’s associate.
ZCDC chief executive Mark Mabhudhu’s mobile was not reachable. In 2018, the government introduced online diamond sales, the Zimbabwe Electronic Diamond Trading System (ZEDTS), to promote transparency.
According to Chitando when the system was launched, the implementation of the ZEDTS was supposed to “augur well for future diamond sales and supported the ease of doing business mantra”.
The system, he said, was also meant to ensure that the sale of diamonds through the MMCZ was in line with global best practice.
But, despite the auction system, suspicion of collusion was raised as one buyer was enjoying the monopoly.
Last year MMCZ published an advert soliciting for partners in diamond processing under a venture capital agreement. This was in line with the corporation’s strategic initiatives towards increased value addition and foreign currency generation.
This initiative, according to sources, could not sail through after ZCDC raised concerns around its lack of involvement. There are also indications that Jamal’s diamond processing firm was targeting the proposed partnership.
The diamond trading industry in Zimbabwe has always been opaque.
Three years ago, a Lebanese diamond dealer Hussein Robai was deported from Zimbabwe over allegations of illegal diamond trade. He was working with former ZCDC executives.
Robai was deported despite concerted efforts by some Foreign Affairs ministry and ZCDC officials to protect the Lebanese.
He was, however, deported after the intervention of the Central Intelligence Organisation (CIO).
The Department of Immigration deported Robai over his illegal diamond dealing convictions in India. He also faced allegations of diamond smuggling in the country.
ZCDC former chief executive, Morris Mpofu, also faced allegations of abuse of office by inviting Robai despite his criminal record. Mpofu has since been acquitted.
In September 2008, Robai and Yusuf Ossely were arrested in India with rough diamonds worth an estimated US$900 000. They were later sentenced to four years in prison for trading in conflict diamonds.
During Mpofu’s stint as ZCDC chief executive, there were fights over control of diamond sales. This, therefore, substantiates that the two organisations have been a field of turf wars.
MMCZ is an exclusive agent for marketing and selling of all minerals produced in Zimbabwe except silver and gold. It was established through an Act of Parliament (MMCZ Act Chapter 21:04).
ZCDC is a diamond mining company wholly owned by the government with mining operations in Chiadzwa, Manicaland province.
There has always been friction between senior MMCZ and ZCDC officials as the latter was accused of meddling into the affairs of the former in diamond sales.