Dozens of Gaza evacuee families lost millions of shekels over the past year and a half in an apparent diamond investment scam, a Haaretz probe has revealed.
The investors, who are primarily families that were evacuated from Gaza Strip settlements in the summer of 2005, put the monetary compensation they received into a deal run by businessman Eitan Sror.
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he deal, people were told, was diamond brokerage - purchasing diamonds at a low price and immediate resale at a much higher one.
Haaretz has found that the investors have been trying to get the money back over the past month, but to little avail.
That effort has been hindered by the fact that the investors have not filed a complaint with police, nor have they gone to the press. Sources with knowledge of the details of the affair have told Haaretz that the investors were promised their money back, should they keep quiet.
Nonetheless, some of the victims have enlisted the support of individuals in the grey market, asking them to pressure Sror into returning the funds. To date, few if any have been successful.
Each of the 1,800 families evacuated from the Gaza settlements in 2005 received an average compensation of NIS 1.5-2 million.
Many of them are still awaiting approval to build their permanent homes, and were therefore keen to invest the liquid assets in the meantime.
"The story is simple," one of the investors told Haaretz. "There is a certain individual who said there are good deals in diamonds. He offered people ... a 5 percent monthly interest rate."
"It went in rounds of three to four months," the investor said. "You gave money and he would produce a receipt plus one of his personal checks for the principle plus some of the interest. On the date on which the check was to be cashed, he would exchange it for one with the full interest. This is how it went for several periods."
The diamond dealer was Moshav Gilat resident Eitan Sror, a 42-year-old former police officer. He has held several jobs since resigning from the force roughly seven years ago, before registering with the Tax Authority as an authorized diamond dealer a few years later.
A simple check would have revealed to the investors that Sror is not registered however with the Israel Diamond Exchange, the Israel Diamond Manufacturers Association, or the Industry and Trade Ministry.
While this does not meant that Sror lied about dealing in diamonds, it would have raised a red flag to the investors that could have led them to rethink the investment.
The first investors indeed received a handsome return, and word of the opportunity began to spread.
One of the evacuees, who invested hundreds of thousands of shekels and withdrew his investment shortly before the deal collapsed, said, "The first time people gave him money, he really did give them 5 percent monthly interest. This is a huge sum. After the first investors received their promised interest, they left the funds to Sror for further investment rounds."
"When the date to cash the checks from the latest round arrived, they checks bounced, and that's when they began to realize that the money was gone," he said.
"In one day the party ended," said a former senior official in the Gaza Coast Regional Council.
It is unclear exactly how many families lost money, although there is no doubt that it is several dozen. Families from Netivot and Moshav Galit apparently also lost money in the deal.
It is also unclear exactly how much money was lost in total, although investors and sources in the Disengagement Authority estimate that the total is between NIS 35 and 50 million.
Sror's current place of residence is also unknown. In a brief phone conversation, he told Haaretz, "I have know idea what you are talking about. Whoever approached you should check his facts again."
For the complete Haaretz investigative report, see this Friday's Magazine.
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