Dan Gertler: Is this the end for Congo's diamond geezer?

Despite his wide smile and child-like enthusiasm, for his many critics, Dan Gertler has come to represent the personification of all that is wrong in the Western stampede for diamonds, copper and precious minerals in Africa. A stampede in which, critics say, wealthy Western businesspeople extract the precious resources and profits, leaving the locals with little but an empty hole in the ground.

For the 38-year-old Israeli billionaire has made his money thanks to a long friendship with Joseph Kabila, President of the mineral-rich Democratic Republic of Congo.

Mr Kabila, who is facing a challenge to his authority in the east of the sprawling country where most mining is done, has repeatedly and for many years sold Mr Gertler rights to mine Congo's vast mineral wealth at allegedly knockdown prices. Mr Gertler then sells them on to Western – often British – companies at a huge profit.

A spokesman for the non-governmental organisation Global Witness says it holds serious concerns that corrupt Congolese officials could be benefiting from such deals.

Meanwhile, poverty in Congo continues to worsen, with 70 per cent of the population said to be malnourished and vast swathes of the country still without reliable electricity or running water.

Mr Gertler, who spends most of his week in the Congo before flying back to his family in Israel to spend Sabbath with his wife and nine children, thinks he is doing nothing but good for the country's people.

He points to his philanthropy and, in an interview with Bloomberg Markets magazine last week, even declared: "I should get a Nobel Prize."

But officials at the International Monetary Fund seem to take a different view. Last week, the IMF stopped a $500m (£310m) loan to the Congo due to its concerns over the way Joseph Kabila's government had sold minerals to a company said to be controlled by Mr Gertler.

A few days later, his biggest partner in the Congo, London Stock Exchange-listed mining company Eurasian Natural Resources Corporation (ENRC), severed its relationship with him.

Increasingly, opposition politicians, NGOs and other critics are claiming Mr Gertler's grip on the country's mineral wealth is starting to slip. "Western companies don't want to do business with him anymore. He's over," one opposition activist told The Independent.

But just how did this young businessman come to gain such a powerful hold over the president of one of the biggest and most troubled nations on the planet?

For the answer, we must return to the newly renamed Democratic Republic of Congo of 1997. The US-backed dictator Mobutu Sese Seko has just been ousted from his three-decade reign.

Although he calls himself president, Mobutu's nemesis, Laurent Kabila, has still not grappled full control of the country. He desperately needs funds to continue his push. Enter Dan Gertler.

At just 23, the diamond trader had a taste for adventure and an eye for a deal. Having learnt the trade at the foot of his father and grandfather, he had been buying diamonds in war-torn Angola and Liberia, and flying them to the wealthy trading centres of the US, Israel and India. The new Congo must have seemed too good a chance to miss.

Shortly after he arrived in the city of Kinshasa, he secured an introduction to Laurent Kabila's son by the city's chief rabbi.

Also in his twenties, Joseph Kabila had recently been made the leader of his father's army. Dan Gertler was taking an increasingly big role in the family diamond empire. The unlikely duo hit it off instantly.

Joseph Kabila soon introduced Mr Gertler to his father, who recognised in the rich Israeli a quick way to fund his war. According to Mr Gertler, Laurent made him an offer: get me $20m in cash to fund my fight, and I give you a monopoly over Congo's diamond sales.

Thanks to Mr Gertler's wealthy connections and business clout, he raised the money within a few days, putting it into Congo's central bank account in Switzerland.

As his uncle Shmuel Schnitzer told Bloomberg Markets: "The guy has guts. This is the basic thing about him."

To say Mr Gertler backed the right horse is an understatement. Although Laurent was assassinated by a bodyguard in 2001 and the diamond monopoly was later rescinded, Mr Gertler's influence on Joseph also proved incredibly lucrative as he took over from his father.

Today, largely thanks to the exploitation of the Congo's huge mineral rights, Mr Gertler is one of the richest men in the world, with a fortune of more than $2bn.

Global Witness has been dogged in its criticism of Mr Gertler's business dealings, painstakingly assembling paperwork and following the money in his complex transactions. More often than not, the money trail ends in his offshore companies in the British Virgin Islands.

Now, as part of its deal to sever relations with Mr Gertler, the London-listed ENRC has bought him out of its mining joint venture. As ever, Mr Gertler appears to be trousering a substantial profit. ENRC is paying him $550m for his half of the project, having paid him only $175m for its 50 per cent stake in 2010.

Unsurprisingly, Global Witness is concerned. "We oppose this very strongly," said spokesman Daniel Balint-Kurti. "It carries with it a very significant risk of corruption. This is exactly the kind of deal we have been complaining about."

ENRC is not alone among London Stock Exchange companies willing to work with Mr Gertler despite his critics. Glencore, the controversial minerals trading and mining giant, operates a number of mines in partnership with him. Global Witness has repeatedly called on investors to cease dealings with the two companies. However, there are some who hope the IMF's decision will put enough pressure on the Congolese government to change its ways. Some say it is likely that other aid programmes, including those from the UK, will now be put under review until matters improve.

Specifically, the IMF took its stark action because of the failure of the Kabila government to provide adequate explanation of a mining sale it made to Straker, a company the sources claim is related to Mr Gertler.

The IMF insists sales of the Congo people's assets should be done openly and transparently, rather than in backroom deals. For his part, Mr Gertler declares this sort of openness is up to the government, not him: "We're a private company. Why should we announce?" he says. "The lies are screaming to the heavens." In the meantime, as millions of dollars of minerals are shipped out of Congo every day, the country remains one of the world's poorest.