Diamond Giant Pleads to Price Fixing; Now Free to Enter U.S. Market

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DeBeers SA, the huge diamond company, pleaded guilty yesterday in Ohio to price fixing and agreed to pay $10 million to settle a 10-year-old indictment. The deal paves the way for the company to start doing business directly with the American market, the Washington Post reports. Based in London and South Africa, DeBeers controls 60 percent of all rough, uncut diamonds sold worldwide. It already reaches U.S. consumers through intermediaries, including diamond distributors and marketing firms.

Yesterday’s action in a federal court in Columbus, Ohio, may have little impact on diamond prices and market share here. But the settlement will give DeBeers a bigger marketing presence and greater legitimacy with U.S. consumers. The Justice Department had charged DeBeers in 1994 with conspiring to fix the prices for industrial diamonds, rough stones used in a variety of cutting and polishing, in this country and elsewhere. General Electric Co., indicted as a co-conspirator in the case, was acquitted years ago. But the charges have been hanging over DeBeers for years, preventing its executives from traveling to the United States to do business even on precious gems without the risk of being arrested.

Link: http://www.washingtonpost.com/wp-dyn/articles/A48041-2004Jul13.html

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