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Ex-Kimberley Diamonds Boss Arrested Over Yellow Diamond Price Reports

Sep 16, 2015 3:15 AM   By Rapaport News
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RAPAPORT... The former head of Australian-based mining company Kimberley Diamonds has been arrested at Sydney Airport, accused of misleading the stock market, Australian Broadcasting Corp. reports.

Federal Police and investigators from the Australian Securities and Investments Commission (ASIC) arrested Alexandre Alexander when his flight landed in Sydney this morning.

Alexander, 48, who is also known as Alexandre Dergouchine, has been charged with four counts of making false and misleading statements to the Australian Securities Exchange (ASX) between October 2013 and March 2014.

Each charge carries a maximum penalty of five years' jail and a $34,000 fine.

ASIC is alleging Alexander authorized market statements, which failed to disclose the fact that Kimberley Diamonds assumed it would obtain a 30 per cent increase in the price of its rare fancy yellow diamonds.

Between March 2013 and May 2014, Kimberley Diamonds tried to negotiate an increase in the price of the yellow diamonds it sold to the luxury jewelry retailer Tiffany & Co. The company's shares fell by 41.5 per cent and its revised earnings dropped from $7.5 million to $1.5 million when those negotiations stalled in May 2014.

Kimberley Diamonds Pty. Ltd. and its diamond mine at Ellendale in Western Australia were placed into voluntary administration in July.

The Ellendale mine produced around half of the world's supply of rare yellow diamonds.
Tags: Australia, Kimberley Diamonds, Rapaort News, Rapaport News, yellow diamonds
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