International Diamond Dealer Charged With Fraudulent Scheme To Obtain Over $3 Million Of Diamonds

Jay Clayton, the United States Attorney for the Southern District of New York, and Christopher G. Raia, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today the unsealing of a Complaint charging business man and diamond dealer EDWARD CARLOS ST. MARY III with wire fraud in connection with his scheme to fraudulently obtain diamonds belonging to an international exporter and manufacturer of natural diamonds (the “Diamond Company”).  ST. MARY was arrested yesterday morning and was presented yesterday in the U.S. District Court for the Southern District of Texas.

“As alleged, Edward Carlos St. Mary orchestrated an international scheme to steal over $3 million of uncut diamonds,” said U.S. Attorney Jay Clayton.  “He falsified bank records and repeatedly lied to line his own pockets.  New York’s Diamond District is one of the world’s foremost destinations for the sale of precious gems, and this Office and its law enforcement partners are committed to ensuring both wholesale and retail buyers can engage in the market free from fraud.”

FBI Assistant Director in Charge Christopher G. Raia said: “Edward Carlos St. Mary allegedly unlawfully procured hundreds of carats of diamonds worth millions of dollars with fabricated documents and promises of payment that were never upheld. The defendant allegedly disrupted the operations of an international company, and utilized our city to do so. The FBI remains committed to investigating anyone who orchestrates illicit surreptitious schemes to enrich themselves.”

As alleged in the Complaint:^[1]

In or about April 2021, ST. MARY met with the owner of the Diamond Company in India and agreed to purchase uncut diamonds from the Diamond Company.  Between in or about April 2021 and in or about June 2021, ST. MARY and the owner of the Diamond Company exchanged numerous messages regarding the sale of diamonds to ST. MARY.  They eventually agreed that ST. MARY would buy approximately 287 carats of diamonds (the “Diamonds”) from the Diamond Company for approximately $3.275 million.  During that time, ST. MARY sent fraudulent documents and made numerous misrepresentations to the owner of the Diamond Company regarding his communications with his bank (“Bank-1”), the funds in his accounts at Bank-1, and his ability to pay the Diamond Company for uncut diamonds. 

On or about June 11, 2021, the owner of the Diamond Company delivered the Diamonds to a company specializing in secure transportation and the handling of valuable goods (the “Security Company”) to transport the Diamonds to the U.S. and provide them to ST. MARY once he made the necessary payments.  The Diamonds arrived in the U.S. the following week.  After the Diamonds arrived in the U.S., ST. MARY made numerous false statements to the owner of the Diamond Company to explain why he had not yet paid for or picked up the Diamonds. 

On or about August 4, 2021, ST. MARY picked up the Diamonds from the Security Company’s New York City location—without paying for them and without the Diamond Company’s knowledge or authorization.  Thereafter, ST. MARY continued to make false statements to the owner of the Diamond Company to suggest that the Diamonds were still in the care of the Security Company and to provide various explanations for why he had not yet paid the Diamond Company.  By November 2021, ST. MARY began making false statements to suggest that he had, in fact, paid for the Diamonds and sent the owner of the Diamond Company a   fraudulent account statement purporting to show a wire transfer of over $3 million from ST. MARY to the Diamond Company.  No such wire transfer was ever made. 

On or about December 7, 2021, ST. MARY sent a message to the owner of the Diamond Company admitting that he had not paid for the Diamonds and falsely stating, in substance and in part, “this entire time my banker has told me that the funds were in your account. He assured me that you had already been paid.  I will have it done as quick as I possibly can.”  However, there are no records of ST. MARY communicating with anyone at Bank-1 about a payment for the Diamonds. 

To date, ST. MARY has neither paid for nor returned the Diamonds.

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ST. MARY, 55, of Houston, Texas, is charged with one count of wire fraud, which carries a maximum sentence of 20 years in prison. 

The maximum potential sentence in this case is prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge. 

Mr. Clayton praised the outstanding work of the FBI on this case. 

This case is being handled by the Office’s General Crimes Division.  Assistant U.S. Attorneys Remy Grosbard and Ariana Bloom are in charge of the prosecution.