Israel Bourse Bans Traders for Synthetics Swapping

RAPAPORT...The Israel Diamond Exchange (IDE) has kicked out two boursemembers it suspects of swapping natural diamonds with synthetics. The traders were allegedly complicit in switching D-color,high-clarity polished diamonds weighing 3 to 5 carats with lab-grown stones,IDE president Yoram Dvash told Rapaport News Thursday. The traders came to theoffices of a company in the bourse to view the goods, another source with knowledgeof the matter said. That firm discovered afterward that the alleged misconduct had occurred when it checked the threestones in a detection machine. Footage from closed-circuit television helped themtrack down the suspects, the source continued.The accusations involved "switching stones worth hundreds ofthousands of dollars [at the expense of] another bourse member," IsraelVanchovsky, the IDE's deputy director general, said in a note earlier last weekthat only referenced one of the suspects. Bourse executives investigated thecase and reported the suspected fraud to the police last week, Vanchovsky said. The management of the exchange decided Thursday to expel oneof the members for life, Dvash said. It has banned the other suspect for 37months, ensuring that he has to go through the full admission process if hewishes to return to the bourse. Dealers who leave and reapply for membershipwithin three years have a less restricted admission process.