Warrant reveals details of alleged diamond theft

The recent diamond-theft investigation in Yellowknife provides a small glimpse into the secretive and highly lucrative world of northern diamond mining.

Police say they seized 29 rough diamonds worth ‘tens of thousands of dollars’

An employee at Diavik's processing plant has been charged with theft after RCMP found 29 rough diamonds in his garage. (Stefan Wermuth/Reuters)

The recent diamond-theft investigation in Yellowknife provides a small glimpse into the secretive and highly lucrative world of northern diamond mining.

The RCMP announced last month they had arrested a 39-year-old Yellowknife man and charged him with theft over $5,000 in connection with diamonds stolen from Diavik Diamond Mines Inc.

But the diamonds were not stolen from Rio Tinto's mine, located on the barrenlands, 300 kilometres northeast of Yellowknife. According to information RCMP investigators used to obtain a search warrant, they were stolen from the Diavik diamond sorting plant.

There's nothing to indicate it from the outside, but this is where all of the diamonds mined at Diavik and Gahcho Kue pass through before being sold to manufacturers who then turn them into the sparkling stones. (Randall McKenzie/CBC)

Apart from a small sign showing the street number, there is nothing to indicate what goes on in the metal-clad one-storey building near the Yellowknife airport. There's another, equally nondescript building nearby where diamonds produced by the Ekati mine are sorted.

Each year, billions of dollars worth of rough northern diamonds pass through those two buildings. The millions of carats mined annually at the Northwest Territories' three diamond mines are initially sorted and appraised in those two buildings before they are sold in places such as Antwerp, London and India to manufacturers who cut, grind and polish them into sparkling gems.

According to Diavik Diamond Mines Inc., $1.2 billion worth of diamonds from its mine passed through its sorting plant last year alone. That year, five million carats produced by the N.W.T.'s newest diamond mine, Gahcho Kue, were also sorted there.

High security

According to information published by the company, diamonds are initially held in a vault at the mine, then flown "discreetly but under security escort" to the Yellowknife sorting plant.

None of the statements in the search warrant have been tested in court. In it, the RCMP say Diavik security staff told them they had noticed the alleged theft on video. They say on Feb. 19 one of the workers, Samson Mkhitaryan, set aside some stones from the tray of diamonds he was sorting, covered them with his phone, and then put the diamonds and the phone into his pocket.

Before and after they are sorted, each tray of diamonds is weighed. Any difference in the weights triggers a review. According to the warrant, after pocketing the gems, Mkhitaryan went to the washroom (one of the few places in the plant where there are no video cameras) then returned and placed black pebbles in the tray to make up for the missing weight.

Security staff at the sorting plant reviewed past surveillance tape of Mkhitaryan and noticed him allegedly pocketing diamonds on Feb. 5 as well, according to police.

The company did not call police about the thefts until Feb. 28. When dealing with billions of dollars worth of gems each year, it's no small decision to get the police involved, subject your operations to the public process of the justice system, or draw any public attention at all.

According to the warrant, Diavik's "supervisor of security and intelligence" invited RCMP investigators to come to the sorting plant and there showed them the Feb. 5 security video. The security staff advised the RCMP the stolen diamonds are worth "tens of thousands of dollars."

RCMP: Worker initially denies theft

In the warrant, police say Mkhitaryan was escorted to a boardroom to speak to the two RCMP officers. The RCMP say they advised the sorter he was a suspect in an alleged theft, but he was not under arrest. They invited him to come to the Yellowknife detachment to answer more questions. The sorter said he would, but needed to pick up his children first. The meeting was set for 6 p.m.

Another RCMP officer tailed Mkhitaryan after he left the plant, according to the warrant. The officer saw him driving on Highway 3 towards Yellowknife's centre and noticed him texting as he drove. Mkhitaryan then did a u-turn at the Ford dealership at the corner of Highway 3 and Old Airport Road. He went back onto the highway and eventually parked at his house on Bigelow Crescent for five minutes before making his way to the detachment.

The RCMP say Mkhitaryan initially denied stealing the stones, but once shown the video, confessed he had 25 rough diamonds in his garage. Police say Mkhitaryan told them his wife and children knew nothing about the stones. He was placed under arrest and held overnight.

That's when the RCMP sought the search warrant for Mkhitaryan's house and his vehicle, posting an officer at his house while they waited for it.

Police say they found 29 rough diamonds in his garage. Mkhitaryan is scheduled to make his first court appearance on Tuesday.