Investors, Staff Stranded as 'Diamond Investment Firm' Disappears

Finance and Trade
04/04/2016 07:52

Customers and staff of a company called Asia Fine Diamonds (AFD) are up in arms after the so-called investment firm went out of business owing money, Singapore's Straits Times newspaper reported. A report cites a client, Stephen Yeo, who invested $17,785 in a 0.21-carat round cut diamond - described as "fancy intense purplish pink" - from AFD. He never laid hands on it. Meanwhile, an AFD employee said that about 20 sales, telemarketing and administrative staff have not been paid for about two months, with the office closing down in January. The chief executive and owner has also gone missing.

Under AFD's two-year scheme, customers were offered a choice of colored diamonds from a brochure, paying the cost, with the average cost per diamond being about $15,000. They had to sign an acquisition form for AFD to buy the diamonds on their behalf and a "storage and buy-back contract" with AFD. In the contract, customers are described as "the storer", while AFD is "the storage provider". They were told to expect delivery of their diamonds one month later. However, they were advised that to avoid paying tax for their diamonds, AFD would store them in Christie's Fine Art Storage Services at Changi Airport. They would be given access to the warehouse for the purpose of viewing their diamonds, the report detailed. The firm promised a 15% annual return on the investment sum for two years, payable at the end of each year. At the end of two years, the customers could opt for AFD to buy back the diamonds and return them their initial investment sums or, if they wished to keep the diamond, they had to waive the 30% returns. AFD was set up last June and records show that its director, Guillianno Norberto R. Mata Pena, is from the Dominican Republic.