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At least 22,000 Italians defrauded in alleged bank diamond swindle

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Banca Aletti
Europe   Banca Aletti

At least 22,000 bank account holders were defrauded in an alleged mega swindle involving over-priced diamonds that led police to seize over 700 million euros (790 million U.S. dollars) from five Italian banks, local media reported Wednesday.

Two Italian companies called Intermarket Diamond Business (IDB) and Diamond Private Investment (DPI) allegedly bribed executives at five banks - Banca Aletti, Banco BPM, Intesa Sanpaolo, Monte dei Paschi di Siena, and UniCredit - with gifts worth a total of 99,000 euros in exchange for recommending their diamonds as investments to clients in 2012-2016, Italian news agency ANSA reported, citing prosecution documents.

Among the victims of the swindle are Italian rock star Vasco Rossi, who reportedly invested 2.5 million euros in diamonds sold to him at inflated prices on the recommendation of BPM Bank, as well as industrialist Diana Bracco, who owns a pharmaceuticals multinational, a TV presenter, and a showgirl, according to ANSA.

"Vasco Rossi aside, 22,000 savers were involved in the investment diamond 'traffic'," Il Sole 24 Ore business and financial newspaper reported.

"Of the five banks affected by the seizure of 743 million euros by the Finance Guard in Milan, Intesa Sanpaolo, Monte dei Paschi di Siena and UniCredit have already begun refunding their clients," the business paper wrote.

Also on Wednesday, Codacons consumer group said in a statement that "the banks and companies involved in the diamond scam must reimburse citizens who invested their money...up to the last cent" or "risk a deluge of damage suits".

In a June 2018 letter to the Economic Development Ministry, IDB claimed that "the market for investment diamonds sold through banks has been targeted by a media campaign of discreditation" that led clients to wrongly believe their diamonds were not as valuable as they had thought.

"This perception" led to a market glut as owners tried to get rid of their diamonds, which "impeded the possibility of disinvestment" and "aggravated the negative perception" of the value of the diamonds as investments, the company stated.

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