Mafia kingpin linked to R2m diamond theft

Flamboyant Mafia kingpin Vito Palazzolo, also known as Roberto von Palace Kolbatschenko, has been linked with his brother Pietro to the R2-million mugging of a Johannesburg diamond merchant in down-town Cape Town.

In a scene straight out of the award-winning American television series The Sopranos, the Cape Town Regional Court heard allegations that diamond dealer Bernard Sher was robbed by a local gang, which was paid R100 000 for the job, as he emerged from a lift in the Picbel Arcade in Strand Street on November 16 1999.

The court was told that Sher—who was robbed of R2-million in diamonds and R51 000 in cash, his watch, gun and Hebrew prayer book—had first been targeted a month earlier and was followed by the gang from Cape Town’s International airport before the robbery was called off.

The court heard that days before the final attack, allegedly planned by Pietro Palazzolo and jeweller Abdulla Azies Samaai (who is accused of having hired the gang), Vito Palazzolo authorised a R100 000 transfer from the Von Palace Kolbatschenko Trust, which he controls, to his brother’s Von Palace Cutting Works in Cape Town’s Regis House.

After Sher was robbed, according to the state, Samaai rendezvoused with Pietro Palazzolo at the Green Point cricket grounds where he handed over the diamonds and cash—the jeweller allegedly kept R25 000 for himself and was given R100 000 to pay the gang.

The case, which is proceeding, has been the talk of Cape Town legal circles since Pietro von Palace Kolbatschenko first appeared in December with his co-accused, who are allegedly members of the gang. It could not have come at a worse time for Vito Palazzolo. Identified as one of the Sicilian Mafia’s key figures two years ago in an FBI report, he is out on R500 000 bail after being charged with fraud in Cape Town late last year for allegedly providing false information in a 1994 application for South African citizenship.

A wealthy Cape property owner who was convicted in absentia in Italy for drug trafficking and money laundering, Vito Palazzolo first took shelter in South Africa in the early 1980s, was provided with a new identity and ensconced in a riverside mansion in East London.

He was taken under the protective wing of the Ciskei’s late dictator Lennox Sebe and given further social respectability through his friendship with former National Party MP for East London Peet de Pontes—a friendship, amid allegations of bribery regarding Palazzolo’s permanent residence permit, that ruined De Pontes’s political career.

Vito Palazzolo’s name also surfaced when the Mail & Guardian reported in November that the national police violent crimes unit head, Commissioner Leonard Knipe, threatened to “bring down” the government if it continued with a covert operation aimed at exposing senior civil servants and senior policemen connected to Vito Palazzolo.

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