Police: Diamond industry scam artist stashed tens of millions abroad

The allegations against Abramovich including money laundering, fraud, forgery, and use of a forged document, according to his arrest warrant.

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May 1, 2016 21:01
2 minute read.
Handcuffs

Handcuffs [Illustrative]. (photo credit: INIMAGE)

A veteran diamond broker is suspected of stashing tens of millions of dollars in foreign bank accounts, after allegedly defrauding some of the most senior diamond industry figures in the country out of approximately $60 million, police said in court on Sunday.

Hanan Abramovich, 53, was in the Tel Aviv Magistrate’s Court for his fifth remand hearing, where police representative Ofer Klein said investigators had found new evidence of forgery and that Abramovich had implicated himself in some of the allegations.

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Klein also said that in October 2015, $17.5m. was deposited in a bank account Abramovich maintained abroad, part of large sums he is suspected of hiding in accounts, including in Hong Kong.

According to the arrest warrant, police suspect he “embezzled some $60m. worth of diamonds from members of the [Israel] Diamond Exchange [in Ramat Gan],” and that “after the suspect realized that he didn’t have the ability to evade them or their questions, he cut off all connection to them.”

The allegations against Abramovich including money laundering, fraud, forgery and use of a forged document, according to the arrest warrant.

So far police have held confrontations between Abramovich and 10 of the complainants. Thirteen of the people he allegedly stole from were not insured, police said.

One alleged victim whose goods were insured was senior Israel Diamond Exchange executive Yehuda Sayag, from whom Abramovich allegedly stole $1.4m. In court on Sunday, Klein confirmed to Abramovich’s attorney, Adi Carmeli, that Sayag said that he believed that Abramovich had gone bankrupt and was unable to pay people back, and did not set out to rob his victims from the get-go.

Another alleged victim, Amos Fouzailoff – a member of one of the most prominent diamond families in the country – reportedly told police that Abramovich returned $918,000 to him after a deal went sour.

Carmeli maintains that his client is not a con man, but rather a law-abiding citizen who fell into financial distress and has not tried to flee or to evade police.

Abramovich was arrested on April 20, just a few hours after three diamond traders issued a police complaint saying that in the last few months of 2015 they transferred large amounts of diamonds to Abramovich, who served as the middle-man in diamond trades, but that he carried out the transactions and kept the money for himself.

Abramovich worked in the diamond industry for more than 30 years and has no criminal record. He and his wife are the sole shareholders of Hanan Abramovich Diamonds Ltd.

After Abramovich’s arrest, Israel Diamond Exchange managing director Eli Avidar put out a statement saying that “the management of the Bursa [the exchange] in 2016 will show zero tolerance toward those who cause harm to other members of the exchange.

“The Israeli diamond industry has been through difficulties in recent years and unfortunately has been left exposed to unfortunate cases in which people have exploited this situation. The management of the exchange will work closely with law enforcement to clarify the case.”


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