The trial of Alex Alexander, the principal player in the Lerala Diamond Mine saga, has kicked off in Sydney, Australia, with testimony from the main witness in a case in which the diamantaire faces 20 years in jail for deceiving investors.
Russian-born Alexander, the sole director of the company which owned Lerala Diamond Mine, faces four counts of “issuing false and misleading statements to investors”. The charges relate to his dealings regarding Ellendale Diamond Mine, which at the time of the alleged offence was owned by Kimberly Diamonds, majority owned by Alexander. The four counts carry maximum sentences of five years in jail each and/or a fine of P252,000 each.
Australian Securities and Investments Commission national manager – media, Gervase Greene told BusinessWeek on Wednesday that the matter, which dates back to Alexander’s dramatic 2015 arrest at Sydney airport, had restarted.
“The trial (actually, a retrial) started last week. The main witness is still giving evidence, and is yet to be cross-examined. So it will take another couple of weeks to conclude the hearing, I believe,” Greene said in an emailed response to enquiries.
He added that the hearing would take another two weeks or so.
The ongoing trial is Alexander’s second after a jury in April last year failed to reach a unanimous verdict in the matter. Although the diamantaire had his travel restrictions relaxed pending a retrial, a condition was added that he give the Commission 48 hours notice of any international travel.
Even as Alexander faces his hour of reckoning in Sydney, his legal representatives are fighting to ensure he takes the front of the queue for the proceeds of the liquidation of Lerala Mine. Mantle Diamonds, which owned Lerala and in which Alexander is sole director, has filed a P347 million claim against the estate of the mothballed Tswapong Mine for loans allegedly made previously. The total claimed by other creditors is less than P30 million.
Alexander’s claim has been challenged by liquidators and the Master of the High Court, who say no evidence has been provided.
Lerala goes under the hammer via a public auction that starts next Thursday and runs for two weeks. Should Alexander prevail in his arguments, he would receive the bulk of the proceeds of the auction sale.
Meanwhile, the businessman continues to tussle with the government of Botswana in Belgium over a parcel of 53,000 carats from Lerala that authorities here believe was spirited out of the country just before Lerala’s closure last year.
Liquidators, who are demanding the stones’ return, say they have evidence the parcel was sold grossly below value in order to hurry them out of the country, to sidestep creditor obligations.
Lerala Mine closed on May 29 last year, citing weak sales and rendering at least 130 workers unemployed. Liquidators working to recover creditors’ dues found that the parcel of diamonds had been sold at the last minute for $22 per carat and routed through Alexander-linked entities. The official valuation of the stones was $51.9 per carat.