Israelis Support Angolan Civil War In Order To Control Diamond Trade

 After an extraordinary case with a plotline and cast list suitable for a John Le Carre novel, a Russian-Israeli multi-millionaire emerged yesterday as the loser in a $1 billion claim against a rival dubbed the “King of Diamonds” following a bitter dispute over a mining venture in Angola.

Arkady Gaydamak, 60, –

who brought the case in London despite being a fugitive from justice in Israel – was told he had signed away his rights to the business after a long-running and tumultuous relationship with Israeli businessman Lev Leviev.

Uzbekistan-born Mr Leviev –

who has a £35m house in Hampstead, north London – made his vast wealth from four decades as an internationally-renowned diamond trader. The case shone a light on how a handful of foreign players have made fortunes from exploiting Africa’s natural resources.

The dispute centred on a contract allegedly drawn up between the two men designed to share the proceeds of a the mining venture set up during Angola’s civil war – but was lost or shredded after it was handed over to Russia’s chief rabbi for supposed safe-keeping.

In a sometime damning judgement, High Court Judge Mr Justice Vos cast doubt on the word of both men, criticising Mr Leviev, 55, for re-writing history and arrogance and saying that Mr Gaydamak’s evidence could not be relied on.

“I did not find him a reliable witness. He was rather garrulous and unstructured in his answers … He could certainly not be relied upon as regards the details of his evidence,” he said in the 70-page written judgement.

The dispute grew out of Angola’s long-running civil war when the government was trying to wrest control of blood diamonds that Unita rebels were using to fund their cause. Mr Gaydamak supplied arms to the Angolan leadership and also security services, run by a former head of Israel’s intelligence agency Mossad.

Mr Gaydamak, the father of former Portsmouth FC owner Sacha Gaydamak, said he signed an agreement in 2001 for Mr Leviev to act as his “front-man” for a venture in the world’s fifth largest diamond producer. He said that he was seeking a lower-profile after an international warrant was sought for his arrest during an inquiry by the French into kickbacks and illegal arms deals with Angola.

He had sought to split the proceeds 50-50 with Mr Leviev and had been due about $3 million a month but had received nothing since 2004. Mr Leviev said that no deal had been signed and a settlement was agreed in 2011, which ended their dispute.

In his ruling yesterday, Mr Justice Vos cast doubt on Mr Leviev’s claims that no deal had been signed. “I did not find Mr Leviev an entirely reliable witness. He displayed an arrogance, even a contempt, for Mr Gaydamak, which ill-became him since he had been so closely involved with him in 1999 and 2000.”

He added: “I think his denial of any partnership arrangement of any kind was simply implausible and frankly unbelievable.”

However, he said that Mr Gaydamak’s responses showed the “lawless” nature of his dealings in Angola before the 2001 deal.

The case is the latest series of complex business disputes brought to London by billionaires from Russia and the former Soviet states. Mr Gaydamak gave evidence via video link from Israel because he feared arrest on a European Arrest Warrant after he was sentenced in France to 36 months in jail for money laundering and tax evasion.

Mr Justice Vos said that the deal signed in 2011 – in the presence of General Kopelipa, ostensibly the prime minister of Angola – effectively settled their dispute and dismissed the claim.

In a statement after the ruling, Mr Gaydamak announced his intention to appeal. “I have said all along that I was bamboozled into signing” the agreement, he said.

In a statement from his solicitors, Mr Leviev was said to be “obviously very pleased with this outcome.”