Magazine article The FBI Law Enforcement Bulletin

Diamond and Jewelry Industry Crime

Magazine article The FBI Law Enforcement Bulletin

Diamond and Jewelry Industry Crime

Article excerpt

The criminal world is changing. Technology, international commerce, and globalization have allowed lawless individuals to broaden the scope of their activities and the sophistication of their operations. Unfettered by internal policy or bureaucracy, they can morph from one criminal enterprise into another faster than law enforcement can keep pace. The activities normally associated with criminals have expanded beyond national borders and--adding to the usual drugs, weapons, contraband, and sex trade--have become modalities to serve the criminal finances generated. In this respect, diamonds and similar commodities, such as gemstones, jewelry, and gold, regularly appear as facilities to gather, store, and move proceeds of crime undetected by authorities. Street-level illegal activity in diamonds and jewelry has increased, and the criminal and terrorist use of diamonds and gemstones has become the subject of many books and intelligence reports.

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This growing problem presents new challenges to all law enforcement agencies. Understanding the criminal use of diamonds and jewelry, recognizing the issues facing law enforcement, and seeking proactive countermeasures represent the first steps to finding a solution.

Understanding the Criminal Use of Diamonds and Jewelry

No doubt, the relative high values, ease of concealment, and untraceable attributes of diamonds, gemstones, and jewelry prove quite appealing to criminals. Street-level perpetrators involved in residential and retail jewelry store burglaries and robberies favor these items. Moreover, increasing evidence points to the gravitation of the more sophisticated offender, organized crime member, and terrorist toward the use of diamonds, gemstones, and jewelry for criminal financing or as a facility for money laundering, international movement, or storage of crime proceeds. (1) The tracking of currency nationally and internationally through government agencies corrals criminals into the use of alternate currencies, such as diamonds, gemstones, and gold. Law enforcement authorities have identified gemstone and jewelry smuggling operations run by organized crime, and jewelry store thefts linked to organized crime are not uncommon. (2) Further evidence has shown a strong link between street-level criminal activity regarding diamonds and jewelry and organized crime.

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Statistics reflect this criminal use of jewelry and precious metals. From 1999 to 2003, jewelry was among the fastest growing categories of stolen property in the United States and now ranks second only to automobiles by value. (3) This is not surprising as the United States, with approximately 5 percent of the world's population, consumes 48 percent of the annual world production of diamond jewelry, totaling approximately 30 billion U.S. dollars. (4) Similar per capita spending on diamond jewelry could be expected in Canada. Within this North American "diamond culture," an enormous number of jewelry outlets, manufacturers, and suppliers exist to quench the thirst for diamond jewelry. This results in a greater opportunity for criminals to acquire such items and corresponding occasions to insert them back into the legitimate jewelry market. In terms of criminal exploitation of diamonds and jewelry, no other continent has such favorable conditions for product acquisition and for converting the proceeds of crime.

Recognizing the Issues Facing Law Enforcement

Identifying the stolen products, something the police and the public both have difficulties with, contributes to the problem. Another limiting factor involves the lack of knowledge and awareness of diamonds, gemstones, and the jewelry industry at all levels. This translates into a poor understanding of the criminal activity that surrounds these products, specifically the "what, why, and how" of the criminal use of diamonds and jewelry. Many officers who have purchased diamond jewelry would have difficulty describing it in any detail more than its approximate carat weight. …

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