Authorities in Hong Kong have arrested four people concerning a large-scale money-laundering scheme that involved the misrepresentation of lab-created diamonds.
Hong Kong Customs and Excise Department (CED) has seized $HK8.2 million ($AU1.57 million) in assets amid allegations that lab-created diamonds were falsely declared as natural diamonds.
Authorities allege that this group laundered approximately $HK500 million ($AU95.54 million) in 2021 in transactions involving diamond companies based in Hong Kong and India.
As part of ‘Operation Gem Crusher’, customs officers raided eight locations in Hong Kong, seizing diamonds and cash.
The individuals are accused of exporting lab-created diamonds from Hong Kong to India and misdeclaring the origins of the stones to be able to transfer ‘suspicious funds’.
The investigation was described as the first of its nature and was launched in early 2023 with the assistance of Indian authorities.
Grading controversy
In a similar development, the International Gemological Institute (IGI) recently uncovered a 6.01-carat lab-created diamond marked with a laser inscription for a natural stone.
The diamond’s carat weight, physical description, and inscription were a match for a natural diamond graded by the Gemological Institute of America.
After testing the stone, the IGI concluded that it was not a natural diamond and that someone had fraudulently paired a natural diamond report with a synthetic stone.
“Everyone in our industry must be vigilant,” said IGI CEO Tehmasp Printer.
“As attempted fraud increases, the need for ongoing verification is a necessary step to protect consumers from purchasing misrepresented gems and jewellery.”
Italy’s Gem-Tech recently announced the identification of three lab-created diamonds carrying GIA inscriptions that appeared to have been forged.
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