Argyle Diamond Mine Closure: The End of a Sparkling Era

Rio Tinto Argyle diamonds

Pink and red diamonds are among the most special gems in the world. The value of these highly sought-after natural stones speaks for itself, but their rarity has arguably increased since the closure of Rio Tinto’s Argyle mine.

The asset, which ceased mining activity on November 3, 2020, had been in operation since 1983. In that time, 865 million carats of rough diamonds were produced.

The unique geological chemistry of the Western Australia location birthed the rarest hues, including champagne, cognac, blue, violet and of course, the coveted Argyle pink and red diamonds. Millions of carats of white diamonds were produced at the prolific property as well.

After 37 years of output, Argyle’s closure came at a time of flux for the diamond market. The sector has been dealing with reduced demand caused by the COVID-19 pandemic, as well as shifting demographics.

While mining activity has concluded at the source of 90 percent of the world’s pink gems, diamond analyst Paul Zimnisky noted that Rio Tinto is likely still processing ore from Argyle.

“So Argyle diamonds will probably still be ‘produced’ this year,” he said. “Also, Rio may have some rough inventory overhang following all of the supply chain disruptions last year. But by the end of this calendar year or early next year, I think most of the primary market Argyle rough goods will be off the market.”

Demand for pink diamonds steadily growing

Colored diamonds, especially pink and red, are among the most valued gems on Earth. Prices can range from US$10,000 per carat for less intensely colored stones up to US$70,000 per carat for vivid hues.

Ahead of the Argyle closure, pink diamond prices were on the rise. According to the Fancy Color Research Foundation FCRF, the value of pink diamonds rose 116 percent between 2010 and 2020. That’s more than any other colored diamond segment, including the extremely rare blue diamonds.

Even 2020’s disruptions and closures didn’t dent the rosy outlook for colored stones.

“The prices of all pink diamonds overall remained without a change in Q4 2020, with fancy and fancy intense categories presenting a slight increase,” a FCRF report states. “Although 2020 was challenging in terms of logistics and travel, contrary to market expectations, fancy color diamond prices proved to be resilient, with minor price decreases across the board.”

With as much as 95 percent of global pink diamond supply now removed, there is some anticipation that prices for the gems will continue to increase, perhaps at a faster rate.

Source: investingnews

Kunming partners with Rio Tinto for Argyle diamonds

Argyle tender pink diamonds

The world’s second-largest miner, Rio Tinto (ASX, LON, NYSE: RIO), announced that Hong Kong-based coloured diamond specialist Kunming Diamonds is now one of the company’s 13 authorized partners for Argyle pink diamonds. 

In a press release, Rio said this means Kunming will be entrusted with the care and custody of the gems. 

Established in 1987, Kunming is a global, multi-generational company that has built its business into one of Asia’s leading coloured diamond specialists. In 2019, the company was successful in acquiring the entire Argyle Pink Everlasting Collection, a one-off exclusive selection of certified Argyle pink and red diamonds. 

“This is a wonderful honour and showcases our commitment to bringing the world’s rarest diamonds to our global partners and client base,” Harsh Maheshwari, director of Kunming, said in the brief.


Venezuelans go after diamond-backed cryptocurrency Ponzi with $30M lawsuit

crypto currency

A group of Venezuelans that moved to the US to “start a new life” are suing a $30 million cryptocurrency Ponzi scheme that allegedly backed its coins with real diamonds.

On Friday last week, a group of Venezuelans submitted a lawsuit claiming they were fraudulently promised massive returns on investments into the supposed diamond-backed cryptocurrency, Argyle Coin, Law360 reports.

The perpetrators, Jose Angel Aman, Harold Seigel, and his son Jonathan Seigel, were reportedly running two diamond companies – Natural Diamonds and Eagle Financial – and an associated cryptocurrency business that offered the diamond-backed digital assets. According to the report, the perps defrauded over 300 investors.

The group of Venezuelans said they were amateur investors and were sucked into the $30 million scheme after being misled by promises of big returns. Natural Diamonds said it would buy and cut raw diamonds to sell on for a 24-percent return.

The Venezuelans initially invested in Eagle Financial, which also leveraged Seigel’s reputation as a supposed diamond expert to trade high-end diamonds.

“[Eagle Financial] and its principals overstated their experience in the diamond and jewelry businesses to lure investors into trusting [Eagle Financial] and its principals with their investment,” the court document reads.

In reality, the funds that were invested in Eagle Financial and Natural Diamonds were being used to repay earlier investors.

Eventually money ran out, so Aman created Argyle Coin to continue luring investors in an attempt to keep the scheme running. Argyle Coin reportedly offered “risk-free” investments into a diamond-backed cryptocurrency.

However, the digital asset was never developed. The funds beguiled from investors were again used to pay off earlier investors of Eagle Financial and Natural Diamonds.

Aman, Seigel, and Seigel allegedly secured the cryptocurrency with a $25 million performance bond and physical diamonds. But the Venezuelan’s calls for evidence of this and for access to digital wallets containing Argyle Coins, went unanswered.

A troubling cryptocurrency
In April, more than a dozen lawsuits were filed by those lured by Aman and his fake diamonds and cryptocurrency, Palm Beach Daily News reported.

In May this year, the Securities and Exchange Commission (SEC) filed a suit against Argyle Coin forcing it to cease trading and freeze its accounts, calling it a Ponzi scheme. The halt also prevented Argyle Coin from undertaking its initial coin offering.

All three of Aman’s firms were charged at the time, The Wall Street Journal reports.

The scheme began in 2014 when Aman began offering investments in Natural Diamonds, promising the return of 24 percent on top of initial investments, within two years.

Aman and his accomplices then sold investment contracts in Eagle Financial in 2015, and used the funds to repay earlier investors, WSJ says. Aman was also said to be using the funds to live a “lavish lifestyle,” another report stated. Eventually Argyle Coin was created to perpetuate the scheme.

The group of seven Venezuelans are the latest to join a growing list of parties going after Argyle Coin and its deceptive “creators.”


SEC Cracks Down on ICO That Offered Investors Colored Diamonds

The ICO that was promoted as a game-changer on the diamond market faces a dramatic fall from grace.

The U.S. Securities and Exchange Commission (SEC) has pulled the plug on a $30 mln cryptocurrency Ponzi scheme called Argyle Coin. The company, which promised to turn fancy colored diamonds into globally accessible assets, defrauded more than 300 investors.

No diamonds for you

Who told you that colored diamonds are only for ultra-rich individuals? Argyle Coin allowed the average Joe to invest in one of the rarest diamonds in the world. The project was presented as a Blockchain-powered marketplace for trading these precious rocks.

According to the SEC’s press release, Argyle Coin was nothing more than a Ponzi scheme that defrauded new investors in order to pay returns to the old ones. On top of that, Jose Angel Aman, the man behind this scam, used investors’ funds in order to enrich himself (he bought real estate and horses). Overall, those who wanted a piece of luxury ended up losing $10 mln.

As alleged, Aman operated a complicated web of fraudulent companies in an effort to continually loot retail investors and perpetuate the Ponzi schemes as well as divert money to himself,” said Eric I. Bustillo, Director of the SEC’s Miami Regional Office.

Old story, new names

Argyle Coin was supposed to offer its clients a ‘risk-free’ investment opportunity given the ICO is backed by over $25 mln of fancy colored diamonds that are securely stored in the London-based Malca-Amit vault.

Notably, prior to Argyle Coin, Aman had managed to pull off two similar scams – Natural Diamonds and Eagle. Aman was charged with violating securities law antifraud provisions.