A Belgian man was released without bail after being indicted for allegedly concocting a scheme to steal $2.6 million in diamonds from a Manhattan wholesaler, prosecutors announced Friday.
Nehal Modi, 41 of Antwerp faces a first-degree grand larceny charge for the theft that took place between March and August 2015. According to Manhattan District Attorney Cy Vance Jr., Modi allegedly posed as a middleman with ties to the mega-mart Costco in order to obtain the jewels from LLD Diamonds USA, a dealer located at 586 5th Ave. in the heart of the Diamond District.
Instead of selling them to Costco, law enforcement sources said, Modi allegedly pawned off the diamonds he obtained for his own illicit profit.
“As alleged, Mr. Modi conned a Manhattan diamond wholesaler into fronting him millions worth of diamonds for a purported deal with Costco that never existed,” said Vance. “While diamonds may be forever, this flawed scheme was not, and now Mr. Modi will face the clarity of a New York Supreme Court indictment.”
Modi comes from “a well-known family in the diamond industry” who formerly worked for Noble Titan Holdings LLC. He first connected with LLD Diamonds USA in March 2015, and asked the wholesaler to provide him several diamonds, worth nearly $800,000, to potentially sell to Costco.
LLD provided the diamonds to Modi, and later he informed them that a deal with Costco was in place. The wholesaler allowed Modi to buy the diamonds on credit, with the belief that Modi would repay the debt in 90 days.
But detectives learned that Modi allegedly instead pawned off the diamonds at Modell Collateral Loans, which has an office in Midtown, for a short-term loan.
Modi allegedly went back to LLD three additional times in March and April 2015 and acquired more than $1 million in diamonds for sales to Costco that were never made. Though he made some payments to LLD, law enforcement agents learned, he spent the majority of the proceeds on himself and various business expenses.
When he was asked about repayment, the indictment noted, Modi allegedly claimed that he had run into payment problems due to a purported “Costco fulfillment error.”
Even so, prosecutors said, Modi — who already owed LLD nearly $1 million — went back to the wholesaler in August 2015, claiming to them that Costco wanted to buy more diamonds. However, LLD agreed to let Modi take the additional diamonds on consignment, and required authorization for the purported Costco sale and a partial payment up front from Modi.
But after picking up the diamonds from LLD, prosecutors said, Modi allegedly ignored their requirements and pawned off some of them at Modell Collateral Loans to get two separate loans, then sold the rest at various detailers for steep discounts.
Eventually, authorities said, LLD discovered the fraud and demanded that Modi immediately repay the balance or return the diamonds. They then contacted the Manhattan DA’s office, which conducted an investigation with the help of the NYPD Major Case Squad.
Modi faces up to 25 years behind bars if convicted.
