Ace of Diamonds

Over the past decade, the young diamond tycoon Dan Gertler has developed massive commercial and political ties with the Congo. Now this complex web of personal and business interests have led police to suspect that he bribed his friend Avigdor Lieberman.

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Late one night earlier this year, a private plane landed at Ben-Gurion International Airport, and from it emerged the diamond tycoon Dan Gertler. To his astonishment, he was greeted by officers from the National Fraud Investigations Unit, who asked him to accompany them to the unit's headquarters in Bat Yam. There, Gertler was told that he was suspected of bribing his friend, Avigdor Lieberman, now Israel's foreign minister. The interrogators asked Gertler whether he had conducted business with Lieberman or had ever transferred - by himself or through others - money to companies suspected of being under Lieberman's control. Gertler responded in the negative and declared that he had never transferred money to Lieberman or been involved in business with him.

A few weeks later, Gertler was questioned again, under caution.

An ultra-Orthodox Jew, he is almost as well known in Kinshasa, capital of the Democratic Republic of the Congo (DRC, formerly Zaire), as he is in Bnei Brak, the largely Haredi city bordering Tel Aviv. During the second interrogation, he stuck to his guns. In another few months, when Attorney General Menachem Mazuz decides whether to file charges against Lieberman following investigation of his activities - in part on suspicion that he conducted a well-oiled international business network through straw figures, while holding state positions - it will become clear whether the suspicions against Gertler are well-founded.

Gertler is from the third generation of the most important and best-known family of diamond merchants in Israel. His grandfather, Moshe Schnitzer, was president of the Diamond Exchange and received the Israel Prize for life achievement. His father, Asher Gertler, a former goalkeeper for the Maccabi Tel Aviv soccer team, deals in diamonds; his mother is businesswoman Hanna Gertler.

"From an early age he went for the biggest business initiatives," says a person who knows Dan Gertler well. "He is a person who walks on the edge, who takes tremendous chances and gambles anew every time."

Gertler founded his company DGI (Dan Gertler International) when he was 22. Even then, while undergoing a process of becoming religiously observant, the newly discharged soldier decided not to follow the conservative family route and deal in polished diamonds per se, but rather to play in the big league and trade in rough gems. At present, his business empire has stretched into Russia, Angola, England, Sierra Leone and other places, but the epicenter is the DRC in the heart of Africa.

Nowadays Gertler is a pious man who donates generously to Young Chabad and to an organization whose aim is to convince every Jew to study a page of Gemara daily. He is very close to David Abuhatzeira, the kabbalist rabbi from Nahariya and grandson of the revered Baba Sali from Netivot. According to Gertler's friends, he is a temperamental person who likes to relax by listening to Hasidic music on his MP3 player.

Almost every week he goes on business trips abroad in a leased private plane. His primary destination is the DRC, where he has a spacious villa. The local Chabad branch in Kinshasa supplies his meals. The rabbi of Kinshasa, Shlomo Ben Tulila, said in a telephone conversation that he meets with Gertler every time he visits. The diamond merchant is a regular at the many events organized by Chabad House, Ben Tulila explains: "Wherever there is Torah study, precepts, help, he will be part of it. He is very shy and quite charming."

Gertler gets most of his news about developments in Israel from the Haredi newspaper Yated Ne'eman. There is no television in his home, on prestigious Daniel Street in Bnei Brak, where he lives with his wife, Anat, who also became religiously observant, and their seven children. Not long ago he bought an entire building on the street, where the family will move after renovations are completed. He is a workaholic who is always equipped with several mobile phones; he is demanding of his subordinates, capricious and uptight. He also detests public exposure.

"When he knows that something about him is going to be published, he climbs the walls," says someone who knows him well. "His attitude toward the media is irrational."

His mother confirms this and adds that her son has "always" kept his distance from the media. "He doesn't like them; he just can't bear them," she says.

Mutual friends

"There is a good connection between them," says a person who knows both Lieberman and Dan Gertler well. "One of the traits they share is that they are both very suspicious of others."

Lieberman for years removed batteries from his mobile phone during meetings and constantly changed his number; Gertler has not hesitated to hire private detectives and record conversations himself for use in his business affairs. Often he seems to be operating out of a metaphorical war room.

"Look what is happening to the two lone wolves," another friend comments. "In the past few years, they have been surrounded by exactly the same people."

Leibovitch was replaced by a talented young man named Sharon Shalom who, in 2006, managed Gertler's business affairs in the DRC and helped him float a company called Nikanor, which owns cobalt and copper mines in that country. Shalom, 34, held a series of positions in Lieberman's "court" and is currently the foreign minister's chief of staff. He is also well connected in another way: He is married to Sima Levy, the daughter of former foreign minister David Levy and the sister of MK Orli Levy, from Lieberman's Yisrael Beiteinu party. Shalom also assists Lieberman with his personal business affairs. Indeed, as owner of the firm that provided management services to the company founded by Lieberman's daughter, he was questioned by the police within the framework of the investigation of the foreign minister. Shalom is suspected of "laundering large sums of money intended for another" and of being "actively and dominantly involved in a number of cases."

Another name on the list of confidants of both Gertler and Lieberman is Yossi Kamisa, a burly man of 44 with burning green eyes and a former fighter in the Police Special Anti-Terror Unit (Yamam). He is the only person to date who has declared that Lieberman and Gertler were business associates during the period in which the former was a member of Knesset.

"At first Lieberman thought Kamisa was a powerhouse," says a person who knows Lieberman well. "In his first years in politics, Lieberman brought into his close circle all kinds of people with some sort of security background. He had a weakness for people like that."

In the past few months, as the Lieberman investigation has gathered momentum, Kamisa told National Fraud Unit interrogators about his decision to file a multimillion-shekel suit in 2004 in Tel Aviv District Court against Gertler and Maj. Gen. (res.) Yossi Ben Hanan, head of Sibat, the Defense Ministry's Foreign Defense Assistance and Defense Export Organization.

The politics-capital-arms-diamonds nexus was Kamisa's stepping-stone to a new employment opportunity after he left Yamam in 2000 with the rank of sergeant first-class. In July 2000, according to an affidavit he submitted to the District Court, Lieberman asked to meet with Kamisa in his office in the Beit Ofer building in Jerusalem.

According to the affadavit, Kamisa said, "Lieberman noted that he and Gertler urgently needed an Israeli security man to assist Congo in training its army. Lieberman told me that he was a partner in a number of future transactions in Congo with tremendous economic potential ... He went on to tell me that he himself could not be in the forefront of these transactions and therefore I had to be in direct contact with his partner, Gertler."

Immediately after talking with Lieberman, Kamisa hurried to meet Gertler in his office in the Ramat Gan Bourse (Diamond Exchange). According to Kamisa, Gertler told him he was in the midst of negotiations to obtain a diamond-mining concession from the president of the DRC at the time, Laurent Kabila (the father of the current president). The condition for implementing the deal was for Gertler to provide military aid. Subsequently, Gertler denied this vehemently in his response to the court.

Bribing is 'accepted'

Kamisa maintains that Gertler offered him the job of managing the training and arming of the DRC army in return for 80 percent of the anticipated profits. When Kamisa said he wanted to sign a contract, the diamond magnate replied: "In the diamond business we don't draw up agreements - a handshake is enough. And besides, Lieberman is in the picture, so you have nothing to worry about."

Kamisa maintains that he updated Lieberman and a short time afterward flew to the DRC with Gertler to meet its then-chief of staff, Joseph Kabila, and his father, president Laurent Kabila. At the time, the Second Congo War (1998-2003) was raging - one of the most brutal conflicts in the history of the African continent, involving eight countries, dozens of guerrilla organizations and a horrific human toll that included large-scale rape and even cannibalism. This did not deter Gertler from realizing his plan to penetrate the lucrative diamond market in the DRC.

"There is no doubt that Gertler's decision to become a key player in Congo at such a young age proved that he had balls," says a person who knows him well. "The big tycoons did not cotton on to his ambitious initiatives. In making this move, Gertler also made himself powerful business rivals."

So it was that in the summer of 2000, Kamisa and the 27-year-old Gertler entered the office of Laurent Kabila in the presidential palace in the heart of Kinshasa. According to Kamisa, an agreement on security cooperation was struck at the meeting. The lawsuit submitted by him states: "That same day a concession agreement was signed with Gertler in the framework of which he was granted a concession to mine diamonds in Congo with an estimated worth of between $800 million and $1 billion ... It is not superfluous to point out that during these trips, Kamisa witnessed Gertler's method of operation, involving paying considerable sums of money as bribery to different individuals in the Congo government ... all in order to pave the way to a meeting with the president of Congo and to improve the terms of the future agreement that was to be struck between him and the state ... Gertler explained that paying bribes is very accepted in Congo and that his stay in the country, connected with making the transaction, had already cost him more than a million dollars."

In his response to the court, Gertler denied these allegations, calling them vengeful and baseless.

Following the signing of the agreement with Kabila, Kamisa's suit states, Gertler assigned him a new task: to prepare a plan to secure the diamond monopoly and to stop the smuggling activity in the country that made it impossible for the DRC to conduct effective trade in diamonds. Kamisa prepared a plan, recruited Yamam personnel and at the same time worked to advance Israeli military aid to the DRC army. He flew to the DRC again with Gertler and attorney Many, and stayed in Gertler's villa in Kinshasa.

"During that week, Lieberman was updated several times about the developments in Congo," Kamisa states in his affidavit.

However, a bitter surprise awaited Kamisa at the end of that summer: In October 2000, just a few months after they had met, Gertler informed Kamisa that he was severing the business relationship between them. According to Kamisa's affidavit, the reason for this was a report that appeared in the press revealing the Gertler-Kabila deal, under the rather facile headline: "Take Diamonds - Give Army."

However, Gertler's lawyers maintained that the reason their client cut Kamisa loose was that he discovered that the latter's stories about his broad security background were baseless, and because his behavior was unsuited to a complex international enterprise.

Gertler, according to his response to Kamisa's lawsuit, consistently avoided making military and security deals. His involvement amounted to the Congolese asking him "by chance" to recommend an Israeli security expert who would assist them militarily - a message he relayed to Kamisa. Later, the Congolese officials got back to Gertler and told him "Bring us a general, not a sergeant."

Gertler's lawyers rejected outright Kamisa's claims of an alleged partnership with Lieberman. Lieberman, too, flatly denied Kamisa's account when asked about it by police interrogators.

'The politics of negroes'

In his 2004 suit, Kamisa states that Gertler dispossessed him and worked behind his back also in regard to the contract for training and arming the DRC army. However, the late judge Adi Azar, who heard the case, decided to throw out Kamisa's suit on the grounds that the language of the agreement signed by Gertler and Kamisa shows that annulment of the latter's claims was definitive, and the court had no power to decide otherwise. At the end of 2006, Kamisa appealed the decision to the Supreme Court through his lawyer, Eliad Shraga, appending new evidence to the appeal, which is being made public for the first time here.

Among the new evidence submitted in the appeal (which was also rejected, on the same grounds) was a transcript of a conversation between Gertler and Kamisa, which the latter recorded during a meeting with his former employer after the agreement had been drawn up by Many. Lieberman's name came up during the conversation.

Kamisa: "Do you want me to open my mouth next to [Many]? To tell why 99 percent of the things Yvet [Lieberman] does, he does next to him?"

Gertler: "Enough."

The diplomat referred to is Nicole Gad, Israel's ambassador to the DRC from 1999 to 2003. Gad, in effect Israel's last ambassador to the country, is considered by her colleagues to be a professional and very humane diplomat. During her tenure in the DRC, she sent cables to the Foreign Ministry in Jerusalem containing information she had collected about Gertler's activity in the country, and about rumors that reached her regarding the military ties he tried to forge between Israel and the DRC.

For example, a cable Gad sent to the Foreign Ministry in 2000 stated: "The Gertler affair continues to be a hot item in the media. Gertler is described as starving the people and the monopoly is reputedly liable to cause riots if the government does not terminate the contract with him ... The rumor continues to be that in return for the diamonds, Gertler has organized military training by Israeli experts for the Congolese army against the rebels."

According to a source close to the Lieberman investigation, Gad testified in the case, as did former Foreign Ministry director general Eytan Bentsur.

Later in the meeting - when Gertler tried to explain to Kamisa why his prospects of advancing security assistance to Congo on his own were poor - he gave him advice on intra-African politics: "A kushi [a derogatory term in Hebrew for black people] who wants something from you 'sits on your vein' ... A negro likes to talk and make promise after promise, blah blah blah ... Whatever happened between us happened - the person who introduced us, the whole relationship that was formed between us, I tell you again, I am speaking with a great deal of pain, maybe I am speaking against my own personal interest, yes?"

Kamisa: "Well?"

Gertler: "I am not interested in taking part in this, not interested in being involved in it, not interested in any of this ... I will put in a good word for you with Pascal [Mayumba, the DRC deputy chief of staff, who visited Israel that August]. I will speak highly of you, but I am only telling you from my experience, believe me, that if [Pascal] had money, or if he wanted to do something, he would already have done it."

Tensions rose toward the end of the conversation, when Kamisa claimed that his scheme for the Congolese army had enabled the diamond merchant to obtain a fat mining contract.

Gertler responded acerbically: "Yossi, either you are mentally ill or I don't know what. Are you saying that the diamond contract was signed because of you?"

Kamisa: "You told me ... Why did you go to the president the next day?"

Gertler: "Ah, because of the boy [Joseph Kabila]."

Kamisa: "Sure, because of the boy, the boy who didn't press his father?"

Gertler: "Yossi, you don't get it. I understand the politics of negroes."

At the end of the meeting, Kamisa said he was concerned about Gertler's fate in the DRC and gave him some advice of his own: "Organize security for yourself in the month ahead, two people at least, listen to what I'm telling you ..."

Kamisa also showed concern for Gertler's life in the plan he drew up to secure the diamond monopoly. Under the rubric of "VIP Security," he advised Gertler: "In light of the fact that the diamond monopoly concession is creating ferment among residents and diamond merchants in Congo, and in light of the fact that these are people who have economic influence, emphasis will be placed on guarding your life, even though it is hard for you to accept dictates."

Tax windfall

It was rough going at first. Three months after succeeding his father, heavy international pressure forced Kabila to revoke Gertler's monopoly. A 2001 United Nations report describing the state of the natural resources in the DRC is harshly critical of the monopoly agreement with Gertler. It notes that the intention was to generate a flow of money to be used to purchase arms and also to facilitate access to Israeli military and intelligence equipment, thanks to the special connections between the owner of International Diamond Industries (IDI, the DRC branch of Gertler's firm, DGI) and Israeli generals.

Infuriated by the negative report, Gertler hired an American firm that submitted documents to the UN painting a very different picture.

"The report was based on allegations by opposition elements in Congo and by business competitors of Gertler," says Gertler's lawyer, Boaz Benzur. "In April 2002, the UN sent Gertler a letter stating that all the data that were sent to the organization in reaction to the report had been received and corroborated."

Be that as it may, the opening of the Congo market to competition enabled Gertler's veteran business rival, Lev Leviev, to bite off another part of the country's resources. A fierce rivalry developed between the two Israeli tycoons, as well as between them and other Israelis with vested interests. In mid-2001, Charles Okoto, chairman of the Congo state-run diamond-mining company Miba, visited Israel. Gertler went to the airport to welcome him, but he wasn't alone. Two men, whom Gertler later described as "Black Hebrews from Dimona," informed him that they were going to be the visitor's escorts and warned Gertler that they would liquidate him. Three months later, a DRC delegation that visited Israel and also met with Leviev was trailed by private investigators hired by Gertler.

But neither the competition and threats, nor the annulment of the monopoly agreement deterred Gertler. He continued to be a key player on the Congo diamond scene and in 2003 won a new contract. The Gertler-controlled Emaxon Finance Corporation was granted a four-year concession by Miba to market 85 percent of the latter's diamonds, which Gertler purchased at a 5 percent discount. In return, Emaxon undertook to lend $15 million to Miba, which was in dire financial straits, for development and acquisition of mining equipment. The signatories to the agreement with Miba on behalf of Emaxon were Gertler's adviser Rabbi Chaim Leibovitch and attorney Yaakov Neeman, Israel's current minister of justice.

Gertler denies these allegations vehemently. He claims the market value of the diamonds that Emaxon sold was determined properly by Miba, based on their real price, and that according to reports based on official DRC government data, there has been a significant increase in production, in marketing effectiveness and in state tax revenues in the wake of this activity.

In 2004, Gertler's company established a diamond-processing plant in the DRC, by which the Israeli businessman deepened his ties with the African country. Concurrently, he began to become involved in international politics as well. He became Kabila's official personal envoy, and together with Rabbi Leibovitch worked to forge close ties between the DRC and senior officials in Washington.

"He met personally with then-secretary of state Condoleezza Rice on this matter," a confidant says, "and used his influence as much as possible to strengthen the relations between Congo and the Americans. You can attribute to him, for example, Congo's abstention in the UN vote on the U.S. invasion of Iraq. Gertler also met with some of the leaders of the countries around the DRC in an effort to regularize their relations with it. This was not philanthropy on his part. Congo's stability is important for his huge investments there. That is the true secret of his relations with Kabila."

Anti-Jewish feelings

Internet sites related to the DRC and to organizations that survey Africa tend to paint a negative picture of Gertler's business activities. Some sites say he is exploiting his relations with senior government officials so as to appropriate the country's magnificent resources. He is said to have obtained mining concessions in the most prestigious areas of the country at ridiculously low prices and to have signed marketing agreements that destroyed local mining firms.

Gertler's associates sigh when asked about the negative reports. "The garbage in the press is totally due to Congolese politicians who opposed Kabila's rule and used Dan as a punching bag," a Gertler confidant says. "Their real target is Kabila."

That same year, the Nikanor company was registered in the Isle of Man, the famous tax haven in the Irish Sea. In an announcement made to the London Stock Exchange's Alternative Investment Market (AIM), the company stated that its controlling interests were held by the Israeli businessman Benny Steinmetz (50 percent), Gertler (20 percent) and the Anglo-Jewish Gertner family (30 percent). Gertler struck the deal with the DRC's national mining company after spotting the potential profits that could be extracted from copper and cobalt. In November 2007, after raising hundreds of millions of dollars on the AIM, Nikanor merged with a Canadian firm, Katanga Mining, which, like Nikanor, owned copper and cobalt mines in the Katanga area. An announcement of the merger stated that the combined worth of the companies would be $3.3 billion, making the resulting firm the largest copper producer in Africa and the biggest cobalt producer in the world.

But since the merger, Katanga Mining has slipped badly and its market value has plummeted by 98 percent - from billions of dollars to tens of millions - due to the fall in the value of copper and cobalt on international markets and a lower production level of the metals than forecast. Katanga Mining's cash-flow problems forced it to transfer control of the company to Glencore, the Swiss-based commodities giant.

Today Gertler is a major player in copper and cobalt trade in the DRC. Two weeks ago, as usual, he flew there to supervise his extensive network of investments and businesses. Even though he was questioned under caution in the Lieberman investigation, he was allowed to leave the country - overwhelming proof, according to his confidants, of the lack of evidence against him. "If there were something serious against him, would he be allowed to leave Israel?" a confidant asks rhetorically.

A police source stated that "the investigation in Gertler's case is still under way." W

Broken reeds and others

Dan Gertler's lawyer, Boaz Benzur, stated in response to this article: "The subject of our client's relations with Minister [Avigdor] Lieberman has been examined, among other ways, within the framework of the police investigation, which as far as is known has not yet been completed. Our client was questioned in this matter and provided a full account. In light of the fact that the investigation in the matter of Minister Lieberman has not yet ended, our client is unable to provide his official response, so as to avoid any suspicion of obstruction of the investigation. At the same time, Gertler has systematic replies to the questions asked in this matter. Those replies, like the actual state of affairs, indicate that anything published in the spirit of the said questions will take the form of libel."As for relying on [Yossi] Kamisa's allegations, it is well-known that he presented his case to the court some time ago and that his lawsuit against our client was rejected out of hand. The man and his vengeful deeds are a broken reed to lean on, and cannot serve as a basis for a worthy journalistic investigative report, but only for a libel suit. The matter of the recording said to have been made by Kamisa was made known to Gertler for the first time. As far as Gertler remembers, the fact of the cables' existence [sent by the ambassador] was published in the opposition papers in the Congo, as part of a campaign they tried to conduct using him. The matter of attorney Yoav Many and of Sharon Shalom was raised in the investigation, therefore our client is unable to provide the details in his possession in this regard. The gist of the matter is that they were employed legitimately by our client, as are many others whom he employs within the framework of his ongoing business affairs."Our client is active around the world, including extensive business activity in the Democratic Republic of the Congo. Our client has a large representation in that country. Gertler is also developing philanthropic activity there in the realm of vocational training, employment, medicine, the war on HIV/AIDS and more. Gertler has invested, and induced the investment of vast amounts in Congo. The scale of our client's investment in Congo, like his commitment and involvement there, far outstrip the scale of activity of businessmen who are operating in that country and throughout Africa. His activity in Congo has always been transparent and our client is meticulous about abiding by the strict rules of the relevant authorities and institutions in connection with all his transactions in that country. Over the years, various allegations have been put forward by competing elements, which have been repeatedly examined by authorized international bodies. Not only were the allegations found to be baseless, but it was found that the opposite is the case."On behalf of Avigdor Leiberman, attorneys Jacob Weinroth and Yaron Kosteliz stated that the issues referred to in the questions came up in the minister's interrogation and therefore, as long as the investigation continues, their client is unable to respond. "Minister Lieberman replied to all the questions put to him by the Israel Police specifically and concretely," they added. "Subject to this, it should be emphasized that in all the years in which Lieberman held public positions he did not conduct private business with anyone or engage in any private work. Anyone who alleges otherwise is mistaken."Eliad Shraga, Yossi Kamisa's lawyer: "After indictments are filed in these cases it will become clear who is telling the truth and who is not, who is a broken reed and who is breeding nonsense."Yossi Ashkenazi, who represents attorney Yoav Many, declined to comment, as did Nicole Gad, Sharon Shalom and Chaim Leibovitch.