Man Indicted In Alleged $11 Million African Diamond Export Scam
SAN JOSE (CBS SF) -- A dual U.S. and Swiss citizen was indicted for fraud in San Jose on Thursday for allegedly stealing $11 million from 40 investors by telling them they were investing in an African diamond and gold export business, federal prosecutors announced Monday.
Fritz Kramer, 68, told investors he was importing diamonds from the Democratic Republic of Congo to Europe, Asia and the U.S., according to the U.S. Attorney's Office.
Kramer claimed the business would cut out corrupt middlemen in Africa and send a bigger profit to African miners as well as provide the investors with returns of up to 10 times their investment.
But despite dumping millions to accounts controlled by Kramer in Tanzania, South Africa, Zambia and Zimbabwe and sending cash directly to Kramer in Kenya and Switzerland, no investor ever saw any return on their investment, prosecutors said.
Kramer gave them numerous excuses for needing more money, including that he needed to pay for urgent surgery for a business partner, that between $80,000 and $90,000 cash burned in a car crash, that a lawyer seized $95,000 to pay for unpaid legal bills, that he needed to bribe African government officials, that he needed to renew expired documents, or pay for insurance or taxes, among other things, prosecutors said.
He sent fake or altered documents by email as evidence for his claims, including government documents from the Democratic Republic of Congo. But Kramer was never involved in exporting any gold or diamonds and had no intention of returning the investments, according to prosecutors.
Kramer was charged with 11 counts of wire fraud and one count of commodities fraud. He made an initial appearance in U.S. District Court in San Jose last week and is scheduled to return to court on Aug. 22, prosecutors said.
© Copyright 2016 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.
for more features.