Washington keeps a close eye on Marange because of suspicions that diamonds are being sold to Lebanese traders acting for Al Qaeda. Terrorists rely on gems to move money because they are compact, and do not set off metal detectors.
The undocumented diamonds are sold to a mix of foreign buyers, "including Belgians, Israelis, Lebanese, Russians and South Africans who smuggle them out of the country for cutting and resale elsewhere".
"The majority of the diamonds are smuggled to Dubai and sold at the Dubai Multi Commodities Centre Authority. The highest quality diamonds are shipped to Belgium, Israel, or South Africa for cutting," said the report.
The cables suggest that the US diplomats give weight to allegations by Zimbabwe sources claiming that central bank chief Gideon Gono ran the operation, paying for gems with freshly printed "Zim dollars", and reselling them for US dollars.
The trade helps explain why Zimbabwe's central bank had a motive for generating the worst hyperinflation since Hungary in 1946 or Germany under Weimar. The currency disintegrated in early 2009, giving way to US "dollarisation" under the power-sharing deal with premier Morgan Tsvangirai.
The cable relayed claims that Mr Gono ran the operation and pocketed "several hundred thousand dollars a month" before being displaced by Zimbabwe's military. Vice-president Joyce Mujuru allegedly skimmed off similar sums.
The report cited allegations that President Mugabe's wife, Grace, and sister, Sabina, were both profiting from the smuggling. A string of top officials in Mr Mugabe's ZANU-PF party were named as active participants in the venture.
The violence has been staggering. After one assault by security forces "over 200 bodies turned up at Mutare mortuaries. Many of those bodies arrived with fatal gunshot or dog bite wounds and were tagged "BID Marange" or "brought in dead from Marange".
Some allegations came from tribal leaders in the Mutare region near Mozambique, where Marange is located. One source is a member of the ZANU-PF central committee, who stated that the late Sabina Mugabe "had been profiting from the purchase and sale of [Marange] diamonds". The name of the source is not redacted by Wikileaks, leaving him vulnerable to reprisals.
The reports buttress claims that African Consolidated, which has long alleged that the Mugabe elite seized the property to enrich itself and finance the ZANU-PF machine.
Andrew Cranswick, ACR's chief executive, is identified by name as a source for one cable, giving specific details about specific individuals in the smuggling ring, including a prominent South African.
"It was highly irresponsible for Wikileaks to publish names," he told The Daily Telegraph. "This is extremely dangerous and puts peoples' lives at risk."
Mr Cranswick has other difficulties. He has been declared bankrupt by an Australian court for overdue taxes. The company, which also has phosphates and metals, has been crippled by the Marange dispute. It operates from a modest house in a Harare suburb.
A survey report for De Beers indicated that the Marange fields have a ratio of more than 1,000 carat per hundred tons, eight times higher than peers. One industry expert said it was "the richest diamond field ever seen by several orders of magnitude".
ACR executives first realised its full potential when it the saw local boys using the glassy green-black stones in slings to kill guinea fowl. "We asked one youngster to show us the stones in his pocket and almost all of them were diamonds. That is when we understood," said Mr Cranswick.
The Marange stones - 70pc industrial, and 30pc gems - came to the Earth's crust 1.3m years ago, far earlier than other diamonds. The radiation has changed their appearance, so it takes an expert to spot that they are diamonds.
Tribal chiefs said the diamonds were causing havoc. "The environmental degradation was severe, violence reigned, and the community was not benefiting from the resource. Three quarters of the schools failed to open because teachers and students alike were digging for diamonds," said the cable.
The US embassy said Marange could be a bonanza for battered Zimbabwe, perhaps generating sales of $1.2bn (£760m) a year. Instead it had become a "curse".
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