Three American men have pleaded guilty in Texas recently to a diamond investment fraud scheme. The three men ran the scheme from March 2011 until November 2013, defrauding 77 diamond investors out of a total of $6.4 million.
According to the Justice Department, the three men ran a company called Stonebridge Advisors in Dallas. This company was involved as the Managing Partner of Worldwide Diamond Ventures, also located in Dallas. Worldwide Diamond was primarily involved in the business of buying and reselling diamonds on the international market. On October 1, 2013, Worldwide Diamond filed for bankruptcy in Texas.
In 2011, the three men realized that their business plan was not working, but failed to inform the investors of the fact. Starting 2012, all three were “engaged in a scheme to defraud investors by fraudulently concealing from investors that investor funds were being used for unauthorized purposes unrelated to the purchase and resale of diamonds”.
On November 2017, the three men received considerable jail time for their role in the scheme. Christopher Arnold Jiongo, 57, was sentenced to 46 months in federal prison and ordered to pay $3,786,595 in restitution. Co-defendants Craig Allen Otteson, 65, and Jay Bruce Heimburger, 59, were previously sentenced to 121 months and 97 months, respectively, in federal prison. Jiongo received a reduction to his sentence due to his early guilty plea and cooperation with the government’s investigation.
