Brian L. Schumacher, the former head of Rochester, N.Y.–based Integra Diamonds, has been charged with wire fraud and wire fraud conspiracy for allegedly defrauding two investors with promises of big returns from rough diamond sales from Africa.
The complaint, filed June 29 in Western District of New York federal court, claimed that Schumacher worked with two coconspirators, who were not named.
A press release from the U.S. Attorney’s office said that Integra duped two purported victims. The first, a Massachusetts resident, invested $100,000 in the company with the promise of a $60,000 profit in the first year, it said. That person eventually received just $30,000 of their initial investment back, according to the complaint.
It also charged that Integra sent the investor an “executive summary,” which asserted it was a member of several industry groups. Clint Homer, an inspector with the U.S. Postal Inspection Service, reached out to those groups and found Integra was not a member of any of them, he said in an affidavit. The summary also listed ITT Space Systems and Intel as clients, but the inspector also said that was not true either.
A California investor also put $100,000 into Integra, with the enticement of a 50% return in 90 days, according to the complaint. It said that Schumacher spent $90,000 of that on a trip to Sierra Leone to buy diamonds, where he purchased 1,211.85 carats of industrial diamonds for $30,296.25. Schumacher then allegedly resold those diamonds to a U.S. diamond broker for $11,514. In the end, none of the second victim’s money was returned, the complaint said.
The inspector said in an affidavit that he interviewed Schumacher, who allegedly admitted that none of the first investor’s money went to diamond purchases, his business did not have a model for turning a profit, and that some of the representations on the executive summary were false, but it “needed to appear impressive and professional to entice investors.”
Schumacher could not be reached for comment. His listed public defender declined comment, as another attorney was taking over the case.
(Photo: Getty Images)Follow JCK on Instagram: @jckmagazine
Follow JCK on Twitter: @jckmagazine
Follow JCK on Facebook: @jckmagazine