De Beers Diamond Cartel

[Magda Hassan]

Namibia: Exposing The Corrupt Practices Of The De Beers Diamond Cartel

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By Laurie Flynn

Wednesday, June 11, 2008

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Gordon Brown is a Scots born whistleblower who exposed the De Beers diamond cartel's overmining at the worlds richest mine and has consequently paid a heavy price for telling the truth about the largest international mining company.

In 1993, Gordon Brown was arrested on an Illicit Diamond Buying charge in Naimibia. Facing trial on very serious charges in 1994, he was given an unprecedented five year jail sentence on a first offence by a single judge sitting on his own without a jury. Gordon had no serious legal representation at the trial; his lawyer of choice withdrew at the very last moment leaving him in the hands of a lawyer who was wholly unfamiliar with the details of his defence. Freed from jail after seven weeks pending appeal, he was advised that it was unlikely that he would get justice in a land where De Beers was so powerful. Later, fearing for his life after the death squad murder of a friend (Anton Lubowski), Gordon fled the country as a fugitive from injustice.

Namibia was illegally occupied by apartheid South Africa throughout the 1970s and 1980s. The UN passed a special decree forbidding mining companies from extracting minerals unless they had specific permission. De Beers and its sister company, Anglo-American, defied this decree and made secret arrangements to overmine the diamonds ahead of Namibian independence. As the technical assistant to the mine manager, Gordon Brown felt it was his simple duty to blow the whistle and came forward to give hard evidence of this illegal behaviour to a judicial enquiry. Since then he has been targeted by members of De Beers' security and their colleagues in the Police Diamond Branch.

Since his arrest and trial Gordon Brown has always maintained his complete innocence. He recently came into possession of conclusive evidence to prove he was telling the truth: the sole prosecution witness, Joseph Eben Dawid, admitted on oath and in writing that he had given perjured testimony to secure Gordon's false conviction. His reward for lying had been a well paid job in De Beers' diamond security division which he had taken up just before the trial.

As soon as Gordon discovered that the UN had modernised its procedures and was admitting human rights complaints from individuals, he began to prepare his complaint. Travelling to Geneva in the summer of 2006 he lodged his complaint at the correct office and obtained a receipt. He heard nothing for a whole year despite emails and phone calls from his home in Cape Town, South Africa. Then, in 2007, Gordon discovered that his complaint had mysteriously disappeared.

Only after repeated complaints was he able to get back on track in autumn 2007. The Namibian government has now cobbled together a response to Gordon's complaint and is hoping to have it ruled out as inadmissible. But the nature and extent of the human rights abuses against Gordon Brown are so considerable and his case is so well particularised that this is unlikely.

In addition to the UN initiative, action is being taken to bring the De Beers diamond cartel to account for its human rights abuses, illegal diamond mining operations in Namibia and a raft of other human rights abuses including conspiracy to pervert the course of justice, malicious prosecution, suborning and interfering with witnesses. Brown wants the directors and officials who conspired to destroy his reputation and his business activities in Southern Africa brought to book and punished for their crimes.

For decades De Beers worked hand in glove with the apartheid government and the Namibian and South African diamond police to protect its monopoly and hobble its critics and business rivals.

Thanks to Gordon Brown's courage in telling the truth about the way De Beers and its sister company Anglo American worked in gem mining, our knowledge of the realities behind these corporate veils has increased dramatically.

10 things we know about De Beers diamond cartel because of Gordon Brown

1. The Anglo-American corporation obtained control of the Namibian diamond deposit in highly dubious circumstances during and after World War I and ran it as a monopoly business even though the League of Nations/United Nations mandate expressly outlawed all monopolies.

2. De Beers took control of a diamond deposit the size of Wales in return for an annual ground remit of £130 per annum. This rent never changed between 1920 and 1970.

3. The Namibian Police Diamond and Gold branch was a De Beers front - with offices provided and furnished by the cartel.

4. The South West Africa Diamond Board was a joke watchdog with its offices situated in and paid for by De Beers.

5. The Diamond Board secretary, Stanley Jackson, was seconded to the post by his employers, De Beers and all controls over the movement of diamonds in and out of Namibia were in the hands of cartel officials.

6. The De Beers group opposed all cutting of diamonds in Namibia and structured itself to avoid tax and move minerals though a worldwide web of companies each of which added costs and subtracted profits in order to maximise De Beers returns abroad. This scam is known as transfer pricing.

7. The company had so effectively colonised the government mining department supposedly responsible for regulating it, that the top government mining officials didn't even know the name, never mind the detailed terms of the law they were supposed to enforce.

8. This put De Beers in prime position to abuse the mine, overexploit the diamonds by grade and stone size for many years while the cartel's friends in politics in Britain, America and South Africa delayed independence forAfrica's last colony.

9. In this way De Beers shortened the life of the mine and took away an extra billion pounds worth of diamonds ahead of Namibian independence. With working costs at 25% of revenue this means that the company plundered £750 million in excess profit and unjust enrichment from a poor country heading for independence.

10. De Beers diamonds will be remembered as tokens of some people's wealth and other people's poverty because conditions at the world's richest mine were ferociously exploitative with black miners condemned to inhuman conditions, the shocking details of which Gordon Brown, among others, exposed.

A criminal enterprise

In 2004, De Beers was given a formal criminal conviction in the United States for conspiracy to violate competition law and fined the maximum amount of $10 million. In November 2005, the group agreed to pay $295 million to settle price fixing and restraint of trade lawsuits brought by individuals who had bought over-priced diamonds from cartel customers and jewellers in the United States. De Beers sister company, Anglo American, has recently been fiercely criticised for human rights violations in the Congo. Other companies in the Anglo group are the subject of criticism in South Africa for its treatment of miners and local people living near the mines.

With Gordon Brown's UN case, De Beers and its friends in the Namibian state hierarchy are hoping to have the complaint dismissed on the basis that Gordon should return to the Namibian capital, Windhoek, for justice. But sadly, the state party's poor overall human rights track record, its persistent human rights violations and abuses, its disregard for the fundamental human rights and freedoms entrenched in the Namibian constitution and its disrespect for the workings of the Human Rights Committee mitigate against this.

The annual reports of Amnesty International, other human rights organisations, and even of the US Department of State, contain numerous references to evidence of torture and ill-treatment of prisoners, detention without charge or trial, extra judicial executions, disappearances after arrest, denial of freedom of expression and association, police brutality, hate speech, prison abuses and denial of fair trial rights in Namibia. A further aggravating issue is the lack of separation of government powers; proper separation of powers is essential to create or maintain a democratic state based on the rule of law. The accumulation of all power, executive, legislative and judicial in the same hands may by contrast be regarded as the very definition of tyranny. Yet Namibia massively centralises power.

One of Namibia's leading government ministers, Pendukeni Iivula-Itlana holds no less than five key appointments and serves as Minister of Justice, Attorney General, person legally responsible for the Office of the Prosecutor General, secretary general of the ruling SWAPO party and SWAPO member of parliament. She also serves on the Judicial Services Commission which appoints judges in Namibia.

This concentration of executive, legislative and administrative power in the hands of one individual in the Namibian government makes a mockery of its claim to be functioning on the principles of democracy, the rule of law, and justice for all. Furthermore, the Namibian justice system is in severe crisis. According to the 2007 US State Department of State Country Report on Human Rights Practices, there are around 50,000 unresolved cases on court dockets and people have to wait years and years for justice.

Justice for Gordon Brown campaign

De Beers Security and the Police Diamond Branch came to court against Gordon Brown with extremely dirty hands, employing perjury and suborned witness to obtain a conviction. This extremely serious perversion of the course of justice has been repeatedly brought to the attention of the Namibian police, the Ministry of Justice, and individual judges and still nothing has been done to annul the conviction of an innocent man and punish those who perverted the course of justice.

Gordon has another reason for declining to put his fate once again in the hands of a corrupted process in Namibia. As he left the court in 1994 to begin his five year jail sentence following his false conviction for Illicit Diamond Buying, he was arrested yet again and charged with still another concocted crime: extortion from his former employer De Beers.

The arresting officer had come to the court at the bidding of De Beers which has enormous power in Windhoek, the nation's capital, and throughout the land. The officer concerned, Chief Inspector Terblanche, had earlier been exposed as an accomplice to the murder of Anton Lubowski, a prominent Windhoek lawyer and one of the first white people to join SWAPO, by the apartheid death squads, the so-called Civil Co-operation Bureau.

Prior to his murder, Mr Lubowski had shown great interest in reforming the corrupt world of diamonds in Namibia. He and Gordon Brown had travelled to Lusaka, Zambia on two occasions to present their proposals for change to the SWAPO leadership in exile. Gordon had also advised both Sean MacBride and Bernt Carlsson, the United Nations High Commissioners for Namibia, on just how much better the industry could be run.

De Beers felt threatened by this and fabricated the phoney extortion charge which still hangs over Gordon. Time and time again Gordon has demanded details of this charge but De Beers and the Namibian prosecuting authorities decline to provide any such information.

Gordon recently returned to his native city, Glasgow, Scotland to inform his supporters about the latest moves in his campaign to clear his name. As well as pursuing the Namibian state parties implicated in the frame up and destruction of his reputation and business interests, Gordon is preparing to pursue De Beers and Anglo-American through the law courts in Britain for their part in the campaign against him. He also plans to take his campaign to the United States, De Beers' biggest market and the scene of the recent criminal conviction for illegal business practices.
http://www.zcommunications.org/namibia-e...urie-flynn