A recent operation in northern Brazil has put a spotlight on the country’s often overlooked illegal diamond trade, but authorities are only scratching the surface of the fast-growing criminal economy.
In late September, Brazilian authorities launched a massive operation to curb illegal diamond mining in the Roosevelt Indigenous reserve between the northern states of Rondônia and Mato Grosso, Globo reported. The operation consisted of raids across eight states that targeted illegal miners, intermediaries who valued the diamonds, companies selling them and even Indigenous residents who collaborated with the miners.
According to Globo, the large-scale investigation began in 2018 after local police caught three people smuggling diamonds from the reserve. Over the next two years, investigators uncovered a transnational criminal network estimated to move about $20 million per month from illegal mining. Many of the diamonds were sold in jewelry shops, either domestically in São Paulo, or abroad in France, Switzerland and Italy.
A recorded conversation from a tapped call between two miners in May 2019 revealed some of the network's inner workings. In one part of the conversation, the miners speak about certain diamonds being sold for $5 million in Switzerland, according to G1 Globo, which gained exclusive access to the wiretap transcript.
InSight Crime Analysis
While Brazil’s illegal gold mining industry has been extensively documented, the illegal mining and black market trade of diamonds has received less attention.
The Roosevelt Indigenous reserve has one of the world’s largest diamond deposits and has been attracting miners since 1999, when diamonds were first discovered there. Current law does not allow mining on indigenous lands. But President Jair Bolsonaro has vowed to legalize commercial mining on the grounds, which will likely lead to a significant increase in mining activities.
According to Brazil's Research and Mineral Resources Company (Companhia de Pesquisa de Recursos Minerais - CPRM), the Lajes mine, the largest in the Roosevelt reserve, could produce 1 million carats of diamonds per year, valued at over $200 million.
Brazil’s diamond mining industry has seen significant growth. According to data from the Kimberley Process Certification Scheme, the South American country produced 31,800 carats of diamonds, worth $1.4 million, in 2015. Three years later, in 2018, the country produced 250,940 carats, worth $54.9 million -- an increase of 689 percent.
But the expansion of illegal mining in Brazil has caused widespread environmental damage in the Amazon. Deforestation linked to illegal mining increased by 80 percent in the first four months of this year when compared to the same period in 2019, Greenpeace reported. And there are currently more than 450 illegal mining sites in the Brazilian Amazon, according to research by the Amazon Geo-Referenced Socio-Environmental Information Network.
Given Brazil’s vast and largely untapped diamond reserves, the country is at risk of becoming embroiled in the “blood diamond” trade, as are neighboring Venezuela and Guyana.
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