Financial investigators are trying to locate a stash of 100 diamonds bought in Hong Kong using money linked to a high-profile Canadian hedge-fund scandal.
The tangled web leading to the diamonds involves a Hong Kong diamond merchant, a Chinese woman with a Hong Kong identity card who made the purchase, and a Canadian hedge fund co-founder hiding in Israel.
When the C$800 million ($5.6 billion) Canadian hedge fund Portus Alternative Asset Management folded last year following allegations that a co-founder misappropriated US$95.4 million, it left 26,000 investors out of pocket. The race was on to trace and recover the embezzled cash before it disappeared forever.
With all but US$17.6 million recovered, investigators appointed to find the missing millions turned their attention to an US$8.8 million diamond purchase conducted by Portus co-founder Boaz Manor in Hong Kong.
KPMG was charged with winding up the defunct hedge fund. According to the company, Mr Manor bought the diamonds in June via wire transfers from a Bermuda bank to diamond merchant MID (HK)'s ABN Amro account.
The diamonds, including a 22-carat gem, were picked up from a shop in Central by Mr Manor's sister-in-law, Yu Jieying - a Hong Kong resident - on four occasions last summer.