Jinix, the diamond 'quest' relates to your choice in which of the three sons you allow to be the head of the family. If you choose the youngest son, he gives you a map of a part of Eastern Isles which a diamond is buried. It is worth 50,000 and you can't equip it, only sell it. This is why I always make Trade 3 a priority. I like getting the 50k at this stage so I always let the young guy head the family. From memory the other two options weren't as good.
EDIT: oh, and I just played through Freedom Islands AGAIN and I don't think there is a quest relating to Lucky James' treasure. When you kill him it basically says 'his money is elsewhere' which I think is a lame explanation for why you don't get millions for killing him. That's it I believe.
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