The Daily Telegraph - Business
We meet with the 93-year-old diamond broker, Willie Nagel
My father was a great entrepreneur,” says the diamond broker Willie Nagel. “He came from an extremely poor family. He had five siblings and he was the most enterprising.” Abraham David Nagel, a devout Jew in Romania, quickly built a business in the early years of the 20th-century by cultivating land that had gone to seed under its aristocratic owners.
By 1939, Abraham was already a successful trader. He heard the King of Romania on the radio, reassuring his citizens that they were safe from the designs of Hitler on the one side and Stalin, on the other. “My father immediately said: ‘We’re going tonight to Palestine’.”
Abraham’s brothers thought he was mad: at the time, Chernowitz, near the Ukrainian border, was enjoying a boom from the refugees from Russia. “People were making money as never before,” Nagel recalls. “But my father had the foresight to say: ‘All this is temporary: I don’t trust the king’.”
The Nagel family fled to Palestine the same day. Chernowitz was occupied by the USSR shortly after; today it is part of Ukraine. Abraham’s family was dispersed; one brother died in the camps.
For Nagel, then aged 14, their evacuation was the start of a journey that would lead him, in 1946, to London, and Hatton Garden, where he became a leading figure in the diamond industry. Along the way, he flirted with a career in diplomacy, rubbed shoulders with prime ministers, and helped establish the Kimberley Process, designed to keep “blood diamonds” out of the market.
Yet a career in diamonds was never the plan. Born in 1925, Nagel was sent to London, 20 years later, to study law. His intention was to return to Palestine, later Israel, to become a magistrate. He was called to the bar in 1950, but began trading diamonds while still a student. “I wanted to be independent, so I stopped the income from my father. The only thing that occurred to me to do was to broke in diamonds,” he says.
There was already a family connection to diamonds: Abraham had started a business in 1941 after meeting a Belgian refugee who was a diamond manufacturer. “My father saw there must be a future for diamonds in Israel. So he said: ‘I’ll finance you.’ They set up a small factory and got goods from De Beers, which at that time didn’t send diamonds to Palestine,” says Nagel.
But he resisted joining the family business. With no connections in London, he resorted to the Yellow Pages. The first firm he tried was run by a man with a dentist’s chair in his office. “When business was bad, he pulled teeth!” Nagel laughs. His second gambit, at the company of Albert Triefus, was more successful. Nagel had a client in Israel lined up but needed Triefus’s diamonds.
Triefus kept stalling until Nagel called his bluff. “I said: ‘If you don’t get me the goods I need, I’ll have to go to other sources.’ I didn’t have any other sources! But I had no option. It just goes to show, once a trader, always a trader.” Fearful of losing the business, Triefus produced a parcel of white and yellow stones. Moreover, Nagel managed to secure a superb discount on behalf of his client. Triefus later became a great friend.
From there, Nagel came to know the characters of Hatton Garden, then, as now, London’s diamond quarter. “People in Israel who worked in the business came to London to see their broker and to see De Beers. Most of them couldn’t speak English. They used me to go to De Beers – that way I got to know the whole hierarchy of the company,” Nagel explains. De Beers at that time controlled 80pc of the global diamond market. To become a De Beers broker, as Nagel did in 1959, was the “highest pinnacle”. But what is the role of a broker, in this secretive industry?
“My job is to make sure the client gets the right goods at the right volume,” he says. In the old days, the broker would take a 1pc cut of the sales, which take place 10 times a year at events called “sights”. A key part of his job was convincing De Beers that a client was worthy of its time.
Perhaps Nagel’s biggest disappointment was that a career in diplomacy was derailed early on. In 1952 he was nominated to become a representative of Israel at the UN. But the message was not communicated to the consul in New York, who appointed someone else. “I was shaken,” Nagel says. The notion of joining the Israeli judiciary soured. “I then took a decision [that] if they behave like this to me… it’s not the place I want to be. Also I loved England, so I remained here.”
Nagel entered the diamond business full-time, trading as W Nagel. Later, he was dismayed to find he could not become a broker to his own father, as De Beers rules forbade him from poaching customers.
Now 93, Nagel’s conversation is still sharp, if punctuated by pauses. His manner is genial, occasionally forceful. He acknowledges that the younger generation has ethical and environmental qualms about buying diamonds, but remains a passionate believer in their “emotional” appeal. He is surprised by De Beers’ recent plan to sell jewellery containing lab-grown diamonds. “It’s a very daring move: the idea is to bring the price of man-made diamonds lower and to make their own goods more expensive… I’m not sure it will work.”
De Beers’ grasp on the world market is much smaller than in its heyday. It no longer requires clients to use a broker – though around 80pc still do. “The sense of the job hasn’t changed – brokers still save money,” Nagel says. Brokers’ take from a sight is much lower, closer to 0.5pc, and W Nagel has diversified into private sales; it no longer just deals with De Beers. Nagel’s son and daughter run the day-to-day operation and, as a partnership, it does not disclose its accounts; Nagel bristles at the notion of revealing its financials.
He prides himself on being a good “mixer”. As a donor to both Conservatives and Labour, he claims he has met every British prime minister and foreign secretary since the Sixties, as well as every US president. Photographs of these encounters line the walls of his office, along with pictures of him with Princess Diana and the Queen. The latter is beaming because, by Nagel’s account, he had just complimented her about how much better she looked than her portraits. “You must be able to talk to everyone,” he says, “high or low.”
Nagel has been decorated for his efforts to foster peace between Arabs and Israelis: “I don’t like to be in the limelight. I think it’s much more effective to be behind the scenes; influence is much more important than power.” He is a Companion of the Order of St Michael and St George, an honour typically reserved for Foreign Office luminaries.
In 2000, Nagel represented the diamond industry at a British and American summit on blood diamonds. These are defined as gemstones that are being used to fund anti-government forces. Nagel’s brainwave was the “chain of warranties”, by which diamond sellers would have to certify the origin of their stones. “It was quite simple. If I sell you diamonds, I must know where from. I must give you a guarantee. If I make a mistake, I’ll be penalised, expelled.”
Inaugurated in 2003, the signatories of Kimberley Process (KP) include 81 countries, NGOs and industry. It has “worked on the whole very well”, Nagel says. The KP’s council is now meeting this year to decide on revisions to the code that may expand the definition of conflict diamonds, amid claims that consumers are being sold an idea of “conflict-free diamonds” that is not true. “The Kimberley Process does need to change, but not to the extent that is written about,” Nagel says.
For all his honours, Nagel’s eyes truly light up when talk returns to his father, of whom, it is clear, he remains in awe. Years later Nagel discovered that Abraham had smuggled hundreds of Jews to Palestine in the early years of the war. “My father had two ships going every week from Constanza to Haifa. He employed 30 to 40 stevedores which he didn’t need. When they arrived in Palestine, the British gave permission to visit the holy places for 48 hours. Would you believe it, that not one of them came back?”
“He was a very reticent fellow. He didn’t talk about it to his children or wife,” Nagel recalls. “When he died, tens of people came to say how they thanked him for saving their lives. He was so modest, unlike me!”