BIRMINGHAM (WWJ) -- A Birmingham jeweler is facing a long prison sentence after pleading guilty to a multi-million dollar diamond fraud scheme.
On July 28, 61-year-old Joseph Dumochelle, was sentenced in federal court to 12 years and 7 months in prison for wire fraud.
According to court records, Dumochelle -- who owned Joseph Dumochelle Fine and Estate Jewelry Buyers, Sellers, Appraisers, and Auctioneers -- persuaded a client to purchase a diamond known as the Yellow Rose for $12 million as an investment. He allegedly told the client that the diamond could then quickly be sold for a lot more.
The client was directed to wire transfer $12 million to what he was told was the seller’s account.
But investigators say he gave the client wire transfer directions to his own account. Dumochelle ended up not using the money to buy the diamond, but instead, paying personal and business expenses and debts.
“White collar criminals may use sophisticated methods and apparently legitimate businesses, but their crimes amount to nothing more than lying to get money,” U.S. Attorney Dawn Ison stated in a news release. “Victims were often targeted because of their involvement in the jewelry investment, purchase, and auction trade, or were family members and friends of Dumouchelle. Victims were lulled into believing Dumouchelle’s false promises because he held himself out to be an expert with valuable connections that would provide them substantial profits.”
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The judge ordered Dumochelle to pay more than $25 million in restitution to all of his fraud victims.
James Tarasca, special agent in charge of the FBI’s Detroit Division, also weighed in, stating: “This defendant defrauded investors by convincing them he was buying and selling rare jewelry for big profits. Instead of actually conducting those transactions, Dumouchelle used the victims’ money to help maintain his expensive lifestyle.”
Once he's released from prison, Dumouchelle will have three years of supervised release.
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