Former Kimberley Diamonds boss arrested for allegedly misleading stock market … – ABC Online

Posted

September 16, 2015 15:46:36

The former head of Australian-based mining company Kimberley Diamonds has been arrested at Sydney Airport, accused of misleading the stock market.

Federal Police and investigators from the Australian Securities and Investments Commission (ASIC) arrested Alexandre Alexander when his flight landed in Sydney this morning.

Alexander, 48, who is also known as Alexandre Dergouchine, has been charged with four counts of making false and misleading statements to the Australian Securities Exchange (ASX) between October 2013 and March 2014.

Each charge carries a maximum penalty of five years’ jail and a $34,000 fine.

ASIC is alleging Alexander authorised market statements, which failed to disclose the fact that Kimberley Diamonds assumed it would obtain a 30 per cent increase in the price of its rare fancy yellow diamonds.

Between March 2013 and May 2014, Kimberley Diamonds tried to negotiate an increase in the price of the yellow diamonds it sold to the luxury jewellery retailer Tiffany & Co.

But the company’s shares fell by 41.5 per cent and its revised earnings dropped from $7.5 million to $1.5 million when those negotiations stalled in May 2014.

Alexander was granted bail when he faced Sydney’s Central Local Court this morning.

But he will be subject to strict travel restrictions and has had to surrender his passport to ASIC.

His case will return to court in Sydney in November.

Kimberley Diamonds Pty Ltd and its diamond mine at Ellendale in Western Australia were placed into voluntary administration in July.

The Ellendale mine produced around half of the world’s supply of rare yellow diamonds.

Topics:

business-economics-and-finance,

law-crime-and-justice,

courts-and-trials,

police,

sydney-2000,

wa,

australia