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Operation diamonds

Yellowknife may not appear to be a gateway for organized crime but Northern RCMP have been preparing for that possibility for five years

Dawn Ostrem
Northern News Services

Yellowknife (Nov 10/00) - A diamond project has been developed by RCMP to prepare for potential problems dealing with organized crime.

The Russian mafia, Asian gangs, Hell's Angels and other biker gangs are three of the main groups G division RCMP say may eventually target lucrative Northern diamonds.




The division's diamond project was formed in 1995 to study and implement strategies to hinder diamond smuggling in the North, taking a proactive approach early on.

"We really want to avoid the come one, come all attitude," said Sgt. Ray Halwas, manager of the RCMP diamonds project.

He said a proactive approach is key at this stage. But early indicators have Northern RCMP paying attention to future crime potential that may be seeping up from larger mafia trade centres in the south.

"We don't want to create a state of paranoia among the people who live here, but a state of awareness," Halwas said.

That is because diamond appeal to criminals is high, he added. They are lightweight and extremely valuable. He sent that message home to attendants of a professional development seminar last Tuesday when he pointed out the ease with which diamonds could be smuggled versus even cash money.

A $20-million stone can fit into the palm of your hand, he said, but $20 million in cash would likely raise eyebrows at an airport as it is lugged around in a briefcase.

Mafia are known to use rough diamonds -- diamonds freshly mined -- to trade straight across for drugs or finished diamonds.

Over the last five years, Halwas travelled to Australia, South Africa and Botswana, veteran diamond producing nations, to study their strategies.

Those countries have legislation in place that deal with permits, licensing and enforcement. The legislation is meant to make it more difficult for fraudulent companies to sell diamonds as well as outline structured enforcement practices.

Canada currently does not have similar legislation.

"In South Africa 47 people on just one shift were involved in organized crime," Halwas explained.

"Australia said at any given time there are multiple conspiracies going on.

"The crime is just starting to develop here."

Halwas explained several incidents that are early indicators of that.

Last year a finished diamond was sold to a Yellowknife retailer from a person who misrepresented themself.

Halwas was also informed by FBI in the United States that a Russian traveller was headed to Northern Canada. He was located in southern Canada before arriving here.

A Hell's Angel affiliate was investigated for his connection to the rough diamonds trade in southern Canada.

"Those give us an idea of the early indicators," Halwas said. "But we don't have the capacity yet to see everything that's going on."

Halwas pointed out the mafia's interest in diamonds is not new but Canada, as a rookie diamond exporter, has to be prepared to protect the industry and the people working in it.

The RCMP diamond project currently consists of one person -- Halwas. It is a federally-funded initiative but Halwas said the RCMP is looking at it from a national perspective and may eventually turn it into a police unit.

In a map Halwas showed seminar participants the main mafia areas. Large blue dots sat in places such as Toronto, Edmonton and Vancouver but they are now joined by Yellowknife.

"Yellowknife is a hub, so this is where we see a primary policing focus being active," he said.