Diamond Dealers Convicted of Mail Fraud for Role in “Bust Out”

On Oct. 24, following a seven-day trial in New York federal court, two 47th Street diamond dealers—Menachem Abramov and Sholom Muratov—were convicted of conspiracy to commit mail fraud for allegedly helping to cheat Indian dealers out of a total $12 million in melee diamonds.

An affidavit from FBI agent Luke Hardison stated that since 2015, the FBI had been investigating a Diamond District gang involved in a series of “predatory frauds” against 47th Street dealers. He alleged that the group specialized in “bust outs,” which typically involve a scammer building up credit with a legitimate dealer, taking that dealer’s diamonds on credit, and then not paying for them. He noted the gang generally targeted dealers in melee diamonds, as smaller stones are tougher to track.

The government indictment charged that, from December 2015 to December 2016, Muratov and Abramov both helped purchase millions in diamonds from dealers in Mumbai, India, by purporting to represent two U.S. companies, Stud Masters USA and Millennium Diamonds Inc. The U.S. Attorney’s office alleged that both companies were “legal fictions,” and the defendants used phony business cards and misrepresented the business’ track records make them seem real.

According to the indictment, after the victims were duped of their diamonds, the stones were sold on 47th Street.

Twelve people were originally indicted in the case in 2017 and charged with both wire and mail fraud. Ten of them—Godel Sezanayev, Mark Mullakandov, Albert Foozailov, Imanil Muratov, Manashe Sezanayev, Nathan Itzchaki, Arkadiy Israilov, Ali Javidnezhad, Mark Natanzon, and Nizamuden Akbari—have since pleaded guilty to various charges with regard to the scheme. Abramaov and Muratov were the only ones to take their cases to trial.

Both men will be sentenced in March 2019. They face 20 years in prison.

Muratov’s lawyer did not return a request for comment from JCK by press time. Abramov’s lawyer declined comment.

(Image: Getty Images)

JCK News Director