The information in these background documents regarding Leviev's companies was last updated in 2009. For more updated information please see Adalah-NY's press releases.
Leviev is the world’s largest cutter and polisher of diamonds, and is also deeply involved in diamond sales, and in diamond mining in Angola, Namibia and Russia. In Angola, Leviev’s role in diamond mining, purchasing, sales and related activities contributes to severe human rights violations.
Leviev is among four owners of the Catoca mine in Angola, the world’s fourth largest diamond mine, and he has interests in four smaller Angolan mines. Leviev is the Angolan government’s international partner in Ascorp, which buys and markets Angolan diamonds, in Sodiam International, which sells diamonds internationally, and in the polishing company Angola Polishing Diamonds. Leviev suggests that his self-proclaimed compliance with the Kimberley Process, which aims to prevent the trade in “conflict diamonds” funding rebel groups, places him beyond reproach. However, Leviev and Angola are not fully complying with the Kimberley Process, according to non-governmental watchdog Partnership Africa Canada. Additionally, the Kimberley process aims only to prevent diamond funded abuses by rebel groups. It does not otherwise regulate the behavior of governments or diamond companies. The poverty and repression of communities in Angola’s diamond mining region where Leviev is active are extreme. Angola’s diamond sector, in which Leviev is a major player, is corrupt, produces minimal direct benefits for the communities where diamonds are mined, and contributes to severe human rights violations. Indeed the denial of the fundamental human rights of these Angolan communities resembles in many respects the denial of rights, the impoverishment, and the seizure of resources experienced by Palestinian communities as a result of Israeli military occupation, repression and settlement. Offenses regularly committed by diamond companies’ security forces and Angolan police include: arbitrary detention, torture, assaults and killings, restrictions on freedom of movement, destruction of agricultural fields, and seizure of property without compensation.
As Angolan human rights activist Rafael Marques, formerly of the Open Society Institute, explains, “The diamond trade has flourished on the back of a socio-economic system based on opacity, extreme violence, and exploitation. In this way, it has also contributed to the immense and uncontrolled wealth that feeds the national and foreign clients of the regime in Luanda.”
Leviev’s close partnership with Angola's Dos Santos regime in the diamond sector is supporting a repressive and corrupt government. Under President Dos Santos, Angola had failed to hold presidential or legislative elections since 1992. In September, 2008, Angola did finally hold legislative elections, and Angola plans to hold Presidential elections in 2009. However, according to a September 15, 2008 Human Rights Watch report, “Angola's parliamentary elections on September 5, 2008… were marred by numerous irregularities… The evidence obtained by Human Rights Watch on these three key issues - observers, media bias, and state funding - suggests the polls did not meet the Southern African Development Community (SADC) Principles and Guidelines Governing Democratic Elections in key areas.”
In 2007 Angola was classified among the most corrupt countries in the world by Transparency International’s Corruption Perception’s Index 2007, ranking 147th out of 179 countries. As one example, in a 2004 report on Angola’s lack of transparency in its use of oil revenue, Human Rights Watch commented, “More than four billion dollars in state oil revenue disappeared from Angolan government coffers from 1997-2002.” And, “The Angolan government has refused to provide information about the use of public funds to its population, thereby undermining the right to information. It has failed to establish hundreds of badly needed courts and allowed the judiciary to become dysfunctional, undermining Angolans’ ability to hold government officials and others accountable. And it has not fully committed to free and fair elections.” Angola’s diamond sector is second only to oil as a government revenue earner, and is plagued by similar problems.
Human Rights Violations committed by Leviev’s security firms: According to Rafael Marques, Partnership Africa Canada (PAC), and other sources, terrible human rights abuses have been committed by private Angolan security companies employed by Leviev and by other international and Angolan companies in the mining districts of Lunda Norte and Lunda Sul in the northeast corner of Angola. As reported by Ben Smith in New York Magazine in 2007, “A security company contracted by Leviev was accused this year by a local human-rights monitor of participating in practices of ‘humiliation, whipping, torture, sexual abuse, and, in some cases, assassinations.’ Leviev's formal response to the report did not directly address the abuses but touted his charitable activities in Angola."
According to Partnership Africa Canada’s “Diamond Industry Annual Review: Republic of Angola 2007”, “Angola’s 1994 Diamond Law delegated extensive policing powers to the holders of government diamond concessions. Within the boundaries of a concession or protected zone, concession holders have the right to stop, question and search anyone, even those travelling on public roadways, suspected of some connection to illegal mining. Those deemed to have contravened the diamond law could be apprehended, forcibly if need be, to be turned over later to the police. As the law came to be interpreted, concession holders could even restrict the use of public roadways to those they deemed to have permission to travel. Concession holders, in turn, have delegated these powers to one of several private security firms.” The result according to Marques is that, “in zones covering hundreds of thousand of hectares, even outside of the concession area, the diamonds companies are the law. The forces of order are their private security companies, equipped with conventional war materiel.”
The private security firm K&P Mineira, described by Marques as providing “the most antagonistic services in the Cuango area,” “shares headquarters, in the capital Luanda, with the Lev Leviev operations. It is also K&P Mineira, one of whose shareholders is the provincial police commander of Lunda-Norte, sub-commissar Elias Livulo, that protects all of Leviev’s buying operations.” In his report “Operation Kissonde” Marques documented 32 very specific cases of human rights abuses committed by K&P Mineira in 2005-2006. Also in “Operation Kissonde”, Marques documents 30 specific cases of human rights abuses committed by a second private Angolan security firm, Alfa-5. Alfa-5 grew out of the South African mercenary group Executive Outcomes and is employed by Leviev and three partners at Catoca, the world’s fourth largest diamond mine. In “Lundas- Stones of Death”, Marques reports that, “The inhabitants of Saipupo village, 2 km from the kimberlite Catoca Project (Saurimo, Lunda-Sul) have been complaining the curfew imposed on car movements in and out of the village from 17H30, even in cases of medical urgency.” Both Marques and PAC have noted some recent improvements in the behavior of the private security firms.
Abuse and exploitation of Angola’s small-scale miners: Many of the human rights abuses by K&P Mineira and Alfa-5 that Marques documented were committed against “garimpeiros”, the informal sector of small-scale, unlicensed miners. In 2002 the Angolan government, with the support from diamond companies and security companies, in part seeing it as a way to fulfil its Kimberley Process obligations, launched a brutal crackdown on the informal mining sector. In addition to expelling hundreds of thousands of foreign miners, private security and police stepped up harassment of “garimpeiros”.
According to Marques in “Lundas- The Stones of Death”, the local population is trapped in an impossible situation by the diamond companies, their security companies, the laws and government policy, which pushes many into informal mining. PAC’s 2007 report summarizes the context, “The nearly one million residents of Lunda Norte and Lunda Sul suffer disproportionately from the exploitation of Angola’s diamond resources. The projects themselves restrict their access to cropland, prohibit their use of local rivers, and in the longer term cause damage to local soil and water systems. The imposition of restricted and reserve zones subjects residents of the Lundas to arbitrary search and seizure by police and private security firms. Their homes and fields can be moved at the order of a diamond mining project. Their range of economic activity is largely restricted to simple subsistence agriculture.” Marques summarizes the outcome: “The Lunda provinces are a territory where the people would die of hunger if they were to abide by the law. This makes it a lawless territory both for the population, and for the diamond entrepreneurs. It is territory where economic activity is based on plunder, on the poverty of the local population, and on the violation or suppression of internationally recognized fundamental rights.”
With informal mining forbidden, yet few income-earning alternatives available except for informal mining, the local population is at the mercy of the security companies, police and mining companies who control the industry and the region. Diamond buyers, including the company Ascorp, which is owned by Leviev and the Angolan government, “take full advantage of the garimpeiros’ precarious legal standing. Garimpeiros entering a buying house are told what price their diamonds will fetch. Little or no bargaining is permitted. In cases where there is a disagreement, buyers simply call their security detail, and tell the garimpeiros they can take the money and leave, or leave empty-handed,” according to PAC.
Minimal Benefits to Angolan Communities: According to PAC, gross revenues from Angola’s diamond sales for the year 2006 were $1.2 billion, including government income for 2006 of $165 million. Nonetheless, minimal benefits have been returned to the impoverished residents of Lunda Norte and Lunda Sul. PAC’s 2007 Annual Review explained that, “Successive Angolan budgets show the Lundas receiving among the lowest amounts of public investment. Villages in the vicinity of diamond mining projects – near Cafunfo and Cuango, near Lucapa, and Nzaji and Saurimo and Dundo – show next to no sign of government spending. There are no government public schools, or water supply systems, or public health clinics. Roads date from the colonial era, and have not been repaired since independence. Agricultural extension programs are nonexistent.” Thus the Angolan government, a close partner of Leviev and a major beneficiary of Leviev’s involvement in Angola’s diamond sector, does almost nothing for the communities where diamonds are mined.
As PAC explains, “The only really visible development impact in the Lundas comes… from the small amount of charitable work carried out by the diamond projects themselves… many of the projects do limited development work in the immediate vicinity of their mining sites, building schools or water supply systems.” PAC mentions the Catoca mine, where Leviev is one of four partners, as “the leader” in this. Catoca “has built a pair of six-room primary schools in nearby villages, and another school combining primary and middle grades. Catoca provides teaching supplies to the schools, and supplements the teachers’ very basic government salaries with a food allowance. Catoca operates a soy milk distribution centre, which daily donates 1500 litres of soy milk to 4000 children in the vicinity (and generates many photos of happy children drinking from milk containers prominently bearing the Catoca logo). Finally, Catoca has built a half-dozen small water distribution systems (essentially small pipelines from a river to a public fountain) in villages surrounding the mine.” In one village visited by PAC, the two kilometre system of piping, “built in 2003, worked for a year and then broke down… it has remained broken ever since."
PAC was also told in 2007 that Catoca had donated $2 million to the hospital in Saurimo, the closet major town. However, Catoca was unable to provide any evidence of that donation to PAC, which Catoca first said was given in 2003-2004, and then later said was given in 2002. Staff at the Saurimo hospital, which has a reported annual budget of $300,000, were unwilling to comment on whether they had received a $2 million donation. Interestingly, given the lack of confirmation, in June, 2004 a reporter for London’s Financial Times described Saurimo’s hospital “bereft of medical equipment.”
Whether or not Catoca, where Leviev is one of four partners, donated to Saurimo’s hospital, the donations cited above pale in comparison with the extreme poverty in Angola’s diamond region and the untold millions of dollars in profit reaped by Leviev annually from Angolan diamonds.
Leviev and the Kimberley Process: Leviev frequently defends his role in Angola by saying that he follows the Kimberley Process. There are two problems with this argument. One is that Leviev is not in fact fully following the Kimberley Process in Angola, and the second is that the Kimberley Process is a regulatory process meant to prevent the exploitation of “blood diamonds” or “conflict diamonds” by rebel groups, but it does not otherwise aim to ensure respect for human rights, nor the achievement of equitable development.
While PAC said in 2007 that there appeared to be “little problem” with Angola’s application of the Kimberley Process in the formal diamond sector, there are major problems in Angola’s informal sector purchasing, an area where Leviev and Ascorp are directly involved, and which produces 11% of Angola’s diamonds by volume, and 26% of Angola’s diamond revenues. Referring to informal sector diamonds, PAC noted in 2007 that there is “no way of tracking those diamonds back to source. The obvious failings in Angola’s Kimberley controls should be cause for concern in the wider Kimberley community. There are, after all, more than a million carats per year exiting Angola, all of it with the murkiest credentials.” According to PAC's 2008 Diamond Industry Annual Review "Angola’s Kimberley Process controls for the informal artisanal sector remain as ineffective and open to abuse as ever."
Finally, the Kimberley Process was never intended as a cure-all, and it certainly has not been in the case of Angola. As PAC explains, The Kimberley Process “has helped to consolidate the peace in several African countries, but it is a regulatory system; it is not a tool for development. In the rush to congratulation, we are in danger of forgetting some of those who suffered most in the diamond wars – the diggers, and their communities.”
Marques asked in a 2007 speech at St. Antony’s College in London, “Should one… say that the extraction of diamonds in Angola is OK? What the Kimberley Process, which was designed to drive blood diamonds out of the market, is doing is to rinse the blood from the gems, extracted in the Lundas, and certify them as clean.”
Justin Pearce, an assistant professor in the Department of Political Science at the University of Guelph in Ontario, explained in African Securities Review in 2004 that, “the Kimberley Process defers to national sovereignty; it has no mechanism to keep a check on abuses that are carried out by, or with the complicity of, the state and its agents. The concept of “blood diamonds” is one which has hitherto been associated with armed conflict. The lesson of the Lundas today is that a notional peace is no guarantee that the exploitation of diamond resources will be done in a way that respects basic human rights, and which contributes to the development and well-being of the diamond-producing region, and the country as a whole. Perhaps it is time to re-think the idea of what constitutes a ‘blood diamond’.”
While Leviev’s diamond mining and sales likely do not fund warlords or insurgency in Africa where they are mined, they do fund the repressive Angolan government, support clear violations of human rights in Israel and Palestine where they are cut and polished, and provide only minimal support to development in Angola.
Leviev and Burma: In September, 2007 The Sunday Times in London reported that one of its reporters was offered a Burmese ruby for sale at Leviev’s London store, possibly a “blood ruby” used to finance Myanmar’s military junta. Despite Leviev's earlier denials, according to an October 18, 2007 UPI article, Leviev was warned by the EU to stop doing business with Burma or face sanctions.