A Birmingham jeweler was sentenced Thursday to 12 years and 7 months in prison for defrauding a client out of $12 million to help maintain his expensive lifestyle. He was also ordered to forfeit $12 million.
Joseph Gregory Dumouchelle, 61, owner of Joseph Dumouchelle Fine and Estate Jewelry Buyers, Sellers, Appraisers and Auctioneers at 251 E. Merrill St. in downtown Birmingham, pleaded guilty in U.S. District Court in late 2018.
Dumouchelle gained some notoriety for twice auctioning Donald Trump's engagement ring to second wife Marla Maples. The first auction was in 2016.
In this case, authorities charged that Dumouchelle began negotiating the purchase and sale of a 77-carat diamond known as the “Yellow Rose” as an investment opportunity for a client. The truth was it was a scam, and there was never going to be any transaction to buy a ring.
He told the client the emerald-cut gem, set in platinum with more than five carats of yellow and white baguette diamonds, could be bought for $12 million and sold quickly for about $16 million. He directed the client to send the money to the seller's account, but in reality, it was Dumouchelle's, authorities said.
After the client wired the money, Dumouchelle quickly withdrew the funds and used them to pay his personal and business debts and expenses, authorities said in a press release.
It was not the only time he swindled clients in schemes. In fact, authorities alleged, that in all, he had defrauded clients out of a total of about $25 million.
“This defendant defrauded investors by convincing them he was buying and selling rare jewelry for big profits,” James A. Tarasca, head of the Detroit FBI, said in a statement. “Instead of actually conducting those transactions, Dumouchelle used the victims’ money to help maintain his expensive lifestyle.
U.S. Attorney Dawn Ison added:
"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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