The Israel Police on Monday arrested six people on suspicion of smuggling diamonds worth some 300 million shekels ($81 million) into the country since 2010.
The case focuses on LLD Diamonds USA, owned by billionaire diamond dealer Lev Leviev, who police say is one of the prime suspects in the case.
The investigation, launched by the Lahav 433 Major Crimes Unit in late March, centers on suspicions that Leviev and his close associates have, for the past eight years, been running a vast gem smuggling ring between Russia and Israel.
Among the six suspects detained for questioning under caution on Monday are two of Leviev's relatives and four other executives who are or were involved in his companies in Israel and Russia.
The six, who are suspected of conspiracy to commit a crime, diamond and gem smuggling, money laundering, issuing fictitious invoices, and several violations of Israel's import and export laws, were arraigned at the Rishon Lezion Magistrates' Court on Monday and remanded to police custody for seven days.
A police source familiar with the case, dubbed "Black Diamond," said the arrests were made possible thanks to the testimony of a state witness.
He added that Leviev, who has vast holdings in Israel, has refrained from visiting the country over the past year for fear of being arrested.
A close associate of Leviev's said he denies any wrongdoing and would cooperate fully with the investigation, including possibly returning to Israel voluntarily for questioning if needed.
A statement by LLD Diamonds said, "The company has no knowledge of the events reported in the media. Mr. Leviev and the companies that he owns follow all acceptable norms and adhere to the letter of the law. We hope that this matter will soon be clarified and the suspicions will prove to be baseless."
Israel has a robust diamond cutting and polishing industry and its diamond exchange is considered one of the biggest in the world.
