Controversial businessman Arron Banks is facing questions from anti-corruption campaigners over a valuable uncut diamond from South Africa that he may have smuggled out of the country, evading thousands of pounds in taxes and flouting controls on the international movement of diamonds set up to prevent the sale of “conflict gems”.
The allegations, made by Forensics for Justice, are based on an email from Banks to a business partner, which the organisation says it collected from the recipient. It forms part of a dossier it compiled this year on Banks’s business dealings in South Africa and Lesotho.
The non-profit group, committed to investigating claims of corruption across Africa, says it spent months digging into Banks’s business dealings. It has reported him and business associates to authorities in Britain and South Africa, claiming its evidence suggests links to crimes relating to diamonds and corruption.
The Observer has learned that the National Crime Agency, which is investigating the source of Banks’s £8m donation to a Brexit campaign, has made enquiries about his business dealings in the region. Banks has said previously that the money he donated to Brexit came from his UK businesses, and there is no suggestion it came from southern Africa.
Banks had previously admitted, in a BBC interview, putting money into the personal account of a government minister in Lesotho, where he was trying to secure a mining licence, but denied the money amounted to corruption.
His former business partner Chris Kimber has claimed to South African police that Banks “was involved in illicit diamond buying in various African countries”, Channel 4 reported. Banks didn’t respond to any allegations put to him by the Observer but has previously described the Channel 4 claims as “ludicrous”.
The new allegations over the movement of the diamond are based on an email from Banks to Kimber, which Forensics for Justice said it obtained from Kimber after the two businessmen fell out.
The email is dated April 2014 and was sent from the UK, said Paul O’Sullivan, a South African certified fraud investigator and Forensics for Justice founder. He claimed he had preserved metadata that confirmed when and from where it was sent.
The email says: “Chris, can you bring over a certificate for the diamond I took back – have you got any blanks!!! Was looking at getting it cut but need the paperwork…A.”
Anyone transporting rough diamonds across international borders, or getting them cut, needs a Kimberley Process Certificate to guarantee that the gem comes from a legitimate mine, O’Sullivan said. These documents are a key part of an international system to prevent gems mined in war zones being sold to fund further conflict.
O’Sullivan also said South African officials told his team that Banks and his company were not authorised as diamond exporters. Kimber also said in a sworn statement that Banks was not an authorised exporter, and “No diamonds have yet been lawfully exported from South Africa to Banks (from his own mines).”
If Banks did not declare the gem to South African authorities, he would have avoided a 15% levy charged by the country on the export of rough diamonds.
“The only way he could possibly have taken it back is in his pocket,” O’Sullivan claimed.
“If it came through in someone’s pocket by walking through the green channel, that would probably amount to the offence of smuggling a diamond,” O’Sullivan added of Banks’s arrival in the UK. “So we made that the cornerstone of our criminal complaint [to UK authorities].”
O’Sullivan claimed he was told the diamond mentioned in the email was a seven-carat stone worth $40,000 in its rough form. Taxes and duty in the UK and South Africa would have run into thousands of pounds.
Banks declined to respond to questions about why he appeared to have brought a diamond “back” without the necessary certificate, and what, if any, taxes were paid in South Africa or the UK on the uncut diamond.
The Forensics for Justice investigation benefited from a falling out between Banks and Kimber, his partner in all his South African mining ventures. Last year, the Bristol-based businessman decided to sue Kimber over the diamond investments in South Africa. The case is ongoing.
Kimber provided a sworn statement to Forensics for Justice, included in the file the group compiled, which details his business relationship with Banks.
O’Sullivan first heard about Banks in 2017, and began looking into his regional business. That expanded into an investigation which included social media analysts, forensic analysts, a lawyer and O’Sullivan himself.
“We like to send out a very clear message, if you want to come and mess around in Africa… we are going to identify you and do what we can to have you prosecuted,” O’Sullivan said.
