The story of Diamond Jack Palmer is a typically Australian story of a beach comber whose luck was in when he found diamonds worth a few million on the beach but couldn’t quite keep up with his luck.

It’s also a fascinating aviation story.

It starts with the Koninklijke Nederlandsch-Indische Luchtvaart Maatschappij airline and their Dutch Dakota DC-3 registration PK-AFV, known as Pelikaan.

KNILM (the Royal Dutch Indies Airways) was founded in 1928 and headquartered in Amsterdam. They initially offered services from Batavia (now Jakarta) to Bandung and Semarang. The airline rapidly expanded and, in 1930, they offered their first international flight connecting to Singapore. In 1938 they started operations in Sydney, Australia.

When the Japanese invaded the Dutch East Indies (now Indonesia), the airline evacuated all the aircraft it could to Australia.

Ivan Vasilyevich Smirnov was a Russian WWI flying ace who returned to military flying as a captain in the army aviation corps in Indonesia after the attack at Pearl Harbor. He was asked to evacuate the Pelikaan with two crew and nine passengers fleeing Java. They left just in time: the Japanese took the Bandung area three days later.

In the early hours of the morning, shortly before take-off, the Bandung airport manager handed Captain Smirnov a cigar-box shaped packaged wrapped in brown paper. Smirnov was told to hand the package to a representative of the Commonwealth Bank once he reached Australia.

The package contained diamonds which were later said to be valued somewhere between 3 million and 10 million pounds sterling in today’s money (4 million to 17 million US dollars). Ivan Smirnov claimed that he was did not know what was in the package. He and his fleeing passengers departed Bandung normally.

As the aircraft skirted the Kimberley coast of Western Australia, about 80 kilometres from its destination, Smirnov saw smoke over the town of Broome, which was under attack by nine Japanese Zeros. Japanese fighter ace Lt Zenjiro Miyano spotted the Dakota and led three Zeros to attack.

The Zeros attacked the defenseless Dakota, firing at its port side. The port engine caught fire. Smirnov was badly wounded but managed to put the aircraft into a deep spiral dive.

His only option was to crash land on the beach. The right tyre exploded forcing the aircraft to veer to the right and into the water, which extinguished the fire in the port engine. The Dakota sank into the sand and swung into the surf which was at high tide.

The Zeros dived to strafe the Dakota again and they scrambled out of the plane to find protection on the beach. Four passengers were killed by the Zeros. Smirnov was badly wounded and sent one of the uninjured passengers to the aircraft to recover the cargo. The passenger picked up the post, the log book and the brown paper wrapped package but then he was hit by a wave and dropped the goods. He recovered the log book and the post but could not find the package.

The following day, while the survivors were waiting for a rescue party, a Japanese Kawanishi H6K dropped four bombs but did not cause any further damage.

Five days later, the survivors were rescued. The representative from the Commonwealth Bank came specifically for the package and Captain Smirnov had to tell him it was lost. The story of the diamonds spread like wildfire, although Smirnov said he never knew what was in the package, only that it was valuable.

It didn’t take long for local man Jack Palmer head to the wreckage to salvage what he could. He and “two Aborigines” collected what they could find. Apparently, he found the cigar box and tipped the largest diamonds into “aluminum cups” which he hid and wrapped the rest in a rag. He showed them to Frank Robinson and James Mulgrue, who were waiting nearby on a motorboat. He’s said to have told them, “Take a handful for each of yourself and don’t tell anyone.”

What’s definitely known is that the three of them were at the aircraft wreck and that afterwards, Palmer was seen around town spending money and bragging that he no longer had to work, only to sit and smoke cigars. He later handed over two salt-cellars of diamonds to the authorities.

From the Advocate, an Australian newspaper, in a short piece published 4th May 1942:

BROOME, Sunday.-The discovery by a beach comber of £300,000 worth of diamonds on a remote north-western beach has been revealed.

Addressed to the Commonwealth Bank, the diamonds were handed in a parcel to Captain Smernof, Dutch pilot of one of the last planes to leave Java after its capture by the Japanese. The plane was shot down by Japanese raiders returning from their first raid on Broome early in March, and crashed into four feet of water in Carnot Bay, 60 miles north of Broome. Of the complement of 12, four died of injuries and were buried in the sand hills near the lonely beach. The others were discovered by natives and rescued, but when a search of the plane was made the diamonds could not be found. Later officials made another search, but without success, and the Dutch authorities then despatched a special officer to investigate. Two days later, Jack Palmer, middle-aged and ill clad, arrived on his way to enlist. He said he had given up his occupation of beach comber, and had abandoned his lugger. Then, producing a pair of large salt and pepper shakers, he poured out on an official’s desk a glittering stream of diamonds. He had found them in a sodden parcel partly embedded in tidal mud near the beach of Carnot Bay. The diamonds are now safe in the Perth Commonwealth Bank.

Palmer was immediately taken into custody for interrogation. He claimed that was all he had and that the package had broken apart with most of the diamonds falling into the sea.

More diamonds showed up in the area, presumably stashed or spent by Palmer, but the total amount recovered was just over 10% of the original shipment.

“Diamond Jack Palmer” and the two men who met him on the motorboat were tried for the theft of the diamonds in 1943. The two accomplices were acquitted as it was determined that no theft had been committed by them. Palmer had handed over two salt-cellars of diamonds to the authorities and although the majority of the diamonds were still missing, the investigation was unable to prove that he had stolen the rest.

The remains of the Dakota remained on the beach until 1970, when the stripped fuselage was broken up by dynamite. The leading edge of one of the wings is apparently all that remains now.

In an interesting addendum, in 1989 a veteran named Norman Keys wrote about his recollections of the crash near Broome.

About the Broome 1942 exhibition

Excerpt from a letter written by Norman Keys dated 29 September 1989. Australian War Memorial PR90/030 After a few days on the beach when the woman and her child and some of the crew were buried, one of the survivors when searching for water was found by one of the local natives who took the rest of the survivors to a dutch [sic] mission station about fifty miles from the beach the plane had landed on. The message got through to Broome 300 miles south and that’s where I entered the story with a trip in a utility to pick them up. When I arrived at the Beagle Bay Mission the four survivors were in a pretty bad way and the Captain Smirnoff appeared to me to be delirious and kept repeating that he had to get back to the aircraft to pick up the diamonds. For a brief period we considered going back to the aircraft with some native guides but it was decided that we had to get the survivors to hospital in Broome as soon as possible and so began the worst 300 miles trip of my life with my passengers cursing every bump. I never really believed the existence of the diamonds until some time later it was reported in the paper that a beachcomber had come across the plane and found some diamonds and was handing them out to the natives as favours and later in Broome was freely displaying them. It turned out that there was a fortune in Dutch diamonds being evacuated from Java to the bank in Melbourne. There were court cases following the discovery of the diamonds but the bulk of the shipment has never been discovered and the belief is that they are still buried somewhere in N.W. Australia.

The interesting thing is that this is the first reference that Captain Smirnov may have known about his cargo of diamonds. After the crash, he had consistently stated that he never knew what was in the package, only that he needed to deliver it. Based on Norman Keys’ account, he may have known exactly what he was carrying but unable to do anything about it.

The remaining diamonds were never recovered.