An anti-corruption group has put luxurious jewellers on alert about their attainable function in funding human rights abuses in Myanmar, saying the nation’s profitable gemstone trade has emerged as an “vital supply” of income for its navy rulers.

In a report launched final week, World Witness stated Myanmar’s navy, which seized energy in a coup on February 1, is now accountable for the nation’s multimillion-dollar gemstone trade.

It stated official knowledge signifies the sector, which incorporates commerce in rubies, sapphires and different gem stones, was price on common from $346m to $415m per yr from 2014 and 2017. However when accounting for the illicit commerce in these gem stones, the report stated the trade might have been price a mean of $1.73bn to $2.07bn yearly over the 4 years.

Given the navy’s management of the sector, in addition to worldwide sanctions on Myanmar navy conglomerates linked to the gemstone commerce, World Witness stated “all firms should urgently assessment their provide chains, to make sure they don’t seem to be funding battle, corruption, or state oppression in Myanmar”.

The group’s report, primarily based on greater than 150 interviews with public officers, neighborhood members and trade representatives, stated all gemstone mining in Myanmar is unlawful at current, as all of the licences issued by the nation’s toppled civilian authorities had expired in 2020, a yr earlier than the coup.

The navy is but to subject any licences publicly, however since its energy seize, casual mining has “exploded” within the nation, World Witness stated, with tens of 1000’s of staff flocking to the mines in Mogok within the central Mandalay area, paying bribes to the navy.

This casual mining is happening in opposition to a backdrop of “excessive instability” in Myanmar, together with in Mogok, the report stated, with the navy accused of committing crimes in opposition to humanity, together with by killing tons of of anti-coup protesters in addition to launching assaults on civilians within the nation’s border areas.

Nonetheless, jewellers, public sale homes and mass-market retailers are persevering with to purchase and market rubies and different valuable stones from Myanmar, it stated.

‘Funding atrocities’

Processed in Thailand, the gem stones from Myanmar are offered to worldwide jewellers and “and in the end to clients who haven’t any method of realizing whether or not they’re funding atrocities”, it stated.

Solely one in all 20 sellers World Witness spoke to in Thailand, Fai Dee, was in a position to establish a particular mine the place one in all its rubies originated.

That exact mine, Shwe Pyi Aye, has been managed since 1995 by Myanmar Financial Holdings Restricted (MEHL), one in all two major military-controlled conglomerates sanctioned by the USA, United Kingdom, European Union and Canada.

An organization consultant from Fai Dee informed World Witness that there was “no method” to say precisely when the ruby was mined, in response to messages seen by Al Jazeera. The consultant informed the World Witness investigator, who was posing as a buyer, that it sells its rubies to main American and British manufacturers like Harry Winston, Graff, Sotheby’s and Christie’s.

When requested for a response, a lawyer for Fai Dee informed Al Jazeera that the corporate didn’t purchase the Shwe Pyi Aye ruby at a time when MEHL managed that mine and that a lot of its assortment pre-dates 1995.

The lawyer additionally stated Fai Dee has been working for 100 years and has acquired various gems in that point originating from Myanmar, however that  “Fai Dee has not bought from any mine or authorities enterprise in Myanmar” since 2008, when the US imposed sanctions on navy conglomerates linked to the gemstone commerce.

These sanctions had been lifted in 2016 following a transition to civilian rule, however had been reimposed this yr following the navy coup.

Fai Dee’s lawyer stated the corporate “has not violated any sanctions referring to Myanmar, nor contributed in any option to human rights abuses in that nation”.

Different Thai sellers, whereas publicly claiming they’ve stopped sourcing rubies from Myanmar are persevering with to take action, in response to World Witness. One firm informed a World Witness investigator who was posing as a buyer that they might nonetheless achieve this as of July this yr.

Due diligence

World Witness additionally stated it had additionally contacted 30 worldwide jewellers, public sale homes and mass-market retailers that promote gem stones, primarily based within the US, Europe and Asia.

“We discovered that almost all of them didn’t have enough due diligence measures in place to make sure that their provide chains weren’t funding abuses. In consequence, these firms could have been funding Myanmar’s navy, one of many world’s most brutal regimes, serving to to maintain its abusive energy over the individuals of Myanmar.”

Peter Kucik, a US sanctions professional with expertise engaged on Myanmar since 2007 and direct expertise assessing the gems sector in Mogok, informed Al Jazeera that World Witness’s findings had been in keeping with his personal.

Noting Myanmar has been topic to varied sanctions regimes, which had been imposed in 2008, lifted in 2016 after which imposed once more in February after the coup, Kucik stated when it comes to sanctions legal responsibility, firms would solely should be involved with gem stones sourced because the February coup.

However he stated there is no such thing as a option to decide whether or not a ruby was mined in 2017 or 2021.

“There’s actually no option to do it. Due to the issue or impossibility of figuring out licit sources, the default new answer seems to be the identical because the outdated one – stop sourcing any rubies from Myanmar to attempt to minimize off the junta’s income stream,” he stated.

Kucik stated sanctions insurance policies are “strict legal responsibility”, that means that if a US firm ended up with a Myanmar ruby that violated sanctions, it could nonetheless be a violation, even when the corporate didn’t know its origin.

“If I am going to Thailand and purchase a briefcase stuffed with rubies and the vendor says these one hundred pc didn’t come from Myanmar, however they did, I nonetheless have an issue, however that will be weighed when it comes to what enforcement mechanism could be used. That ranges in risk from a cautionary letter all the best way to referral for prison investigation if there’s a willful violation,” he stated.

World Witness stated solely three firms, Tiffany & Co, Signet Jewellers and Boodles have publicly declared that they’ve stopped sourcing gem stones from Myanmar because the coup. Cartier and Gubelin informed the group the identical, whereas Harry Winston issued a public assertion on December 9 saying it is going to additionally cease sourcing gem stones from Myanmar.

“In its ongoing dedication to accountable and moral sourcing, the Home of Harry Winston will now not supply gem stones from its suppliers which have Burmese origins, no matter their importation dates,” it stated.

Al Jazeera reached out to Sotheby’s and Christie’s for remark. However there was no response on the time of publication.