As a security measure diamantaires will need to invest in technology and make trusted people their strength to ensure the safety and security of their precious commodity, finds Aasha Gulrajani Swarup for Diamond World.
Call it bold or brazen, the diamond heist was a blow to Antwerp. The world diamond industry was shocked.
The Diamond Heist
In February 2013, without firing a single gunshot, eight criminals made off with thousands of carats of diamonds. Cutting through a hole in the 10-foot high security perimetre fence of Brussels airport, where construction work was underway, the eight gangsters drove into the secure airport zone, in their two black vehicles fitted with flashing blue police lights. Even before the car came to a halt near the Swiss Helvetica Airways airplane preparing for take-off, the gangsters, disguised in police uniforms, jumped out of the cars and waving their guns, threatened the pilot and the ground staff to back off. Within a few seconds, they had worked open the cargo hatch, where the precious diamond consignment had just been placed by a security-armoured van. They made off with a shipment of more than 120 packets of diamonds, getting back into their cars and out through the hole in the fence. Later, a car was found abandoned nearby but the gangsters had made off without a trace.
Insider Information
They struck with military precision. They had exact information, probably being updated in real time from insiders. The plane would have taken off within minutes. But they struck just a few minutes after the diamonds had been loaded, while the plane was preparing for take-off. They knew about the gap in the 10-foot high fence and also how to open the cargo hatch of the Swiss Fokker airplane. The passengers waiting within had no clue, the airplane was being looted. The criminals moved swiftly in a secure airport zone, swarming with police officers, security guards and ground staff, besides extensive video surveillance. The operation took less than five minutes.
Most of the stolen diamonds were uncut roughs, harder to value and trace, and nearly 90 per cent of the gems were bound for Surat, via Zurich, Switzerland for cutting and polishing. These diamonds are, most likely, never going to be recovered.
Informs Stephan Van Hauwe, Senior Security Coordinator at ADA-Security, which promotes the security of people and goods with the Antwerp diamond community: “The chance of retrieving stolen diamonds is limited because rough diamonds can be split into smaller ones and the polished stones can be re-polished. Even if any of the stolen polished diamonds were marked or engraved, the equipment used to do this is freely available and can be used to undo or alter the mark.” Probably the thieves already had a deal with a buyer who did not ask too many questions.
Tight lipped About Valuing The Loss
When goods are stolen for good, then only the declared value could be a clue to the extent of loss. Although, the Antwerp World Diamond Centre (AWDC) declared that it was one of the biggest robberies ever, nobody agrees on the value on these stolen gems. While AWDC stated that the declared value of the gems, a mix of rough and polished stones, was US $50 million, other specialists estimated that the stones were worth more than US $350 million.
The gems were insured, but the players are tight lipped about the value of claims. Malca-Amit, the primary security company transporting these gems, informed that its customers had already been compensated for the loss.
Insurance Claims
Said Nir Matalon, General Manager, Malca-Amit, Antwerpen, “As a result of the Europe Union’s open border policy, there has been a rise in criminal activity. We paid a large sum of money to our customers within 10 days, after the robbery at Brussels airport recently. As we are an AA rated customer of Lloyds of London underwriters, we were able to pay out to our customers in such a short space of time.”
“It is not the first time a hold-up has occurred at Brussels airport and people in Belgium are concerned for the security of the people and of the valuable goods,” said Matalon.
Security: Whose Responsibility?
The brazenness of the incident and its magnitude has sent Antwerp into shock. The city is asking, “How could it have happened?” According to Helvetic Airways, the security for valuable cargo is normally the responsibility of the airport and the security company hired to transport valuable cargo to the plane. However, while the transporter has compensated the owners, the airport seems to have escaped responsibility. Besides ordering an audit of all security measures at the airport, including passenger protection, the airport authorities are silent.
Diamond merchants recalled the string of dramatic robberies at Brussels airport more than a decade ago, when the Belgian government and the airport company were forced to tighten cargo safety and introduce stringent security measures, to retain Antwerp’s position as the centre of diamond trade.
Informs a senior diamond dealer from Antwerp, “Brussels airport was a mecca for thieves. Security was lax and there were several robberies involving high value diamond jewellery, and inside information. Matters came to a head when in 2001, airlines and shipping companies refused to use the airport until security was improved. The government had no choice and Brussels airport had to invest €1.5 million in additional security measures.”
Today, nearly 80 per cent of the world’s uncut diamonds and 50 per cent of the world’s polished diamonds, valued at over US $50 billion, pass through this Belgian city, known for its diamonds and chocolates. About US $200 million in diamonds enter and leave Antwerp daily, with about 99 per cent of these diamonds moving through Brussels Airport in several shipments each week, according to the Antwerp World Diamond Centre.
Considering the quantity of business enabled through Brussels airport, Matalon hopes that the Belgian government will take action to avoid the possibility of security problems at Belgium’s national airport in the future.
AWDC Robbed
As the world’s number one diamond trade centre, Antwerp has a reputation to maintain and business to protect, which was rudely challenged ten years ago. In February 2003, even the armed and protected Antwerp World Diamond Centre, where a security breach was considered impossible, was brazenly robbed. The four thieves had rented office space in the AWDC, three years before they struck, during which they prepared their strategy. They found ways to dodge the 10 layers of security protecting the underground AWDC vault, including infrared heat detectors, Doppler radar, a magnetic field, a seismic sensor, and a lock with a 100 million possible combinations. They inserted fake tapes into the security cameras to cover their movements and used a large, homemade polyester shield with low thermal conductivity, which effectively blocked their body heat from reaching the heat sensing infrared detector. The thieves successfully made off with more than 120 satchels of diamonds worth about US $100 million. The robbery was called the heist of the century. The thieves were eventually caught. But the principal thief pointed to an insider connection. He claimed that a Jewish diamond merchant hired them for the heist. Most of the satchels they stole from the vault were empty. Thus, it was claimed that they actually stole only about US $20 million worth of diamonds and the diamond merchants used the gang of thieves as cover up for a huge insurance fraud. Police denied this possibility.
Antwerp Diamond Area - Security
Yet, the message was clear. Security can never be 100 per cent infallible. It had to be strengthened, in the diamond heartland, where most of the world’s diamond business is conducted, whether on the trading floor or through handshake deals and off-ledger transactions.
The AWDC, in 2010, created Antwerp Diamond Area – Security (ADA-Security), an independent and private security foundation to safeguard business in the Secure-Antwerp Diamond Area.
Informs Stephan Van Hauwe, Senior Security Coordinator at ADA-Security, “There are approximately 1800 different companies, in the Secure-Antwerp Diamond Area, literally located within one square mile of Antwerp. It is the mission of ADA-Security to protect these personnel, products, reputation, information and assets against all internal, external, deliberate or accidental threats.”
For doing this, ADA-Security has close and direct ties with police, security, prosecutor and intelligence services on the local, federal and international levels and maintains an up-to-date incident database starting from the 80's. This three-square-block area is under 24-hour police surveillance and constantly monitored by video cameras at every corner.
At the end of last year, the AWDC and ADA-Security Board of Directors took the strategic decision to invest even more budget, means and resources to professionalise and lift security within the Secure Antwerp Diamond Area to an even higher level.
Information Security
“We also have structural weekly, bi-weekly and monthly meetings to discuss security related topics, incidents, improvements, etc. To a certain degree, the admission of every new member at AWDC, has to be cleared by ADA-Security. From a security perspective, we are also setting up research and vetting programs for new arrivals as well as existing companies,” says Van Hauwe.
Van Hauwe agrees that information is critical for security. He also manages the Open Source Intelligence (OSINT) program for the European Corporate Security Association (ECSA) organization. The ECSA network feeds on news, incidents, events and trends in the fields of crime, security, information security, terrorism, espionage, non-proliferation and areas that might have an adverse impact on the security of businesses and organizations.
People
Another weak link in the security chain is People. While trusted personnel can be a security asset, they can also be insiders for the other side. Van Hauwe believes that people are the key to information. “That’s why one of our slogans is SEC_RITY needs U.”
Transportation
However, the weakest link in the security chain is transportation, as diamonds leave the physical custody of their owners and make their way to new buyers. Transportation of diamonds has evolved over the years. There are more options available in the industry. While some traders, to move diamonds from one city to another, swear by the traditional Angadia network, which functions entirely on trust and integrity, others rely on hand carrying the sensitive package, official government post or private courier services like FedEx, or even professional companies like Malca-Amit and Brinks, which offer secure armoured transportation. The decision depends on the size of the shipment and most of these options offer value added solutions including money processing and insurance, in addition to the transportation.
For instance, a professional company like Malca-amit offers secured door-to-door transportation from collection to delivery with full shipping liability. High value goods are transported in armoured vehicles specially fitted with cutting-edge security systems and tracking devices that ensure that its movement is under constant surveillance. Services also include specially trained staff taking charge of the valuable cargo from the plane, to be delivered directly to any trade show in the world or into a specified vault, or from the mines to the dealers or making a round trip to the grading institutes and back with the professional transporters handling the pickup, processing documents, obtaining customs clearance, managing overnight storage and even inspection facilities for buyers and money processing and collection services for the seller in another part of the world. “We also provide close custody protection and static guarding for protection of jewellery,” says Matalon.
Secured transportation is thus safer. Agrees Kothari, “Security companies are safer than the traditional angadia methods. The Angadia system is an open-ended system whereas insurance companies are more structured and legal. It is important to increase security, especially during transportation of the high value goods by vehicle or airplane. Outsourced security works well in India and internationally, although it might be a bit expensive.”
These security professionals also take the job seriously and make regular investments to provide better safety measures.
“Malca-Amit has invested considerable amounts of money on daily security and on security training. In 2010, we were the first valuable transport company to obtain an A.E.O, or Authorised Economic Operator certification. It is a status that European customs administrations confer upon financially sound companies that strictly comply with customs regulations and enforce a safety and security policy,” said Matalon. He also advises that investing in security is cheaper than having to pay the insurance companies the extra higher premiums as a result of the claims.
Security Investment Cheaper Than Higher Insurance Premiums
In this respect, the repercussions of the diamond heist will be felt by everyone in the diamond industry for several years to come, be it in the form of higher insurance premiums following such a large claim or the necessity of investment in security. The fault lines of the robbery have touched India. Diamond merchants agree that security is an investment.
Security Steps
Says Sanjay Kothari, Vice-Chairman, KGK Group, “Creating a more secure setup by installing security systems and being more cautious towards your goods is the first step to avoid such thefts. Insurance during transit, installation of alarm systems and CCTV cameras for day and night, security guards with guns, time locks on safes, and frisking of work force are some of the most common practices used for security. Additional precautions are needed overseas, as crime is more organised internationally.”
Some of these include installation of security systems, accountability of issued products, separate zones for different production activities, and touch screen fingerprints for access to relevant people. These are some effective measures that make manufacturing a safe process with minimal losses.
Advises Van Hauwe, “Security actually consists of five important and interlinked pillars, including 1. organizational security; 2. physical security measures; 3. electronic security; 4. notification security measures; and 5. information security measures. All these pillars are present within the ADA-Security concept.
“Literally, on a daily basis we're reviewing and dynamically improving all the pillars, based on changes in the market, technology, conditions, laws and regulations and incidents that occur locally as well as internationally. We have a documented and proven Crisis Management Plan (CMP) to deal with minor to major crises. We understand that security cannot be static. It needs to evolve and change constantly,” he said.
Agrees Kothari. “The industry needs to have a more pro-active approach towards this issue and follow security patterns. There is no other option,” he says.
Free Advise On Security
In Antwerp, to increase security in individual businesses, the prevention department of the police office offers diamond merchants free written advice about security measures to be installed or adjusted in order to protect the business against theft and robbery. An increased tax deduction for security investments is also available as an incentive.
These measures have worked and in recent years, the incidents have been limited. As Van Hauwe informs, “considering the high volumes of rough and polished diamonds passing through Antwerp, the context and location of the Diamond Square Mile, the enriching mix of different cultures and nationalities, we actually have very few incidents. In the incidents that have occurred, the criminals specifically targeted the high valuables and left the diamond traders unharmed, which is most important. Antwerp is a safe and secure environment to trade diamonds!”
Security in India
On the other hand, India is a country in transition. Bomb blasts in Mumbai’s congested localities of Opera House and Zaveri Bazaar, the centre for the diamond trade, shook the community. As Kothari recalls, “the bomb blasts in Mumbai compelled diamond merchants to take critical steps. Many diamantaires shifted their diamond offices from Opera House to Bharat Diamond Bourse (BDB), which provides a more secure setup, with access to only those who have business there as compared to the Opera House area, which is half residential, with the rest being shops and offices.”
Bharat Diamond Bourse
Bharat Diamond Bourse (BDB) is the world's largest diamond bourse in Mumbai. Spread over 20 acres of prime land, BDB has a total constructed area of two million square feet with two basements of an additional one million square feet. It is a gated complex with eight towers of nine floors each, designed to house 2500 offices diamond traders, a huge 6200 square feet diamond trading floor, strong rooms, four walk-in vaults, lockers and 24,500 safe deposit boxes, besides offering customs clearance facilities, and space for service providers catering to the diamond community including eight banks, insurance companies, couriers and transportation. The BDB handles 60 per cent of diamond exports from India and expects an inflow of 30,000 people daily, transacting business worth crores of rupees everyday.
Security at BDB
Protecting this complex is not easy. It has a vast network of closed circuit cameras to track the movement of every diamond packet. “Entry is only by biometric cards and we do not allow outsiders to walk in without appointment, and when they arrive, they must call the host who will vouch for them," says Anoop Mehta, BDB president. Even the vehicle of each committee member, including the president, is checked at the gate.
Yet, in spite of the preparedness, any experienced security professional knows that 100 per cent security is not realistic. As Van Hauwe says, “One can only strive to be a ‘hard target,’ making it as difficult as possible for hostile elements to engage in criminal or terrorist activities and make you a victim.”
Follow DiamondWorld on Instagram: @diamondworldnet
Follow DiamondWorld on Twitter: @diamondworldnet
Follow DiamondWorld on Facebook: @diamondworldnet
