Michigan Jewelry Buyer Sentenced for $12M Fraud Scheme

According to court records, Dumouchelle was the owner of “Joseph Dumouchelle Fine and Estate Jewelry Buyers, Sellers, Appraisers, and Auctioneers,” a company doing business in the State of Michigan and throughout the United States. According to the facts made public at the guilty plea hearing, in late 2018, Dumouchelle began negotiating the purchase and sale of a diamond known as the “Yellow Rose.” Dumouchelle proposed the Yellow Rose as an investment opportunity to a client by claiming the diamond could be purchased by the client for $12,000,000 and sold quickly for substantially more. To lull the client into believing the investment was legitimate, Dumouchelle told the client that he could purchase the diamond by wire transferring $12,000,000 into the seller’s account. Dumouchelle sent the wire transfer directions to his client, falsely representing that the account was the sellers. In fact, as Dumouchelle well knew and intended, the wire transfer instructions were to his own account. After the client unknowingly wired the money into Dumouchelle’s account, Dumouchelle quickly withdrew the funds and used them to pay his personal and business debts and expenses.

It was part of Dumouchelle’s plea agreement that other victims of his fraud scheme and their losses would be used to calculate his sentencing guidelines and the amount of restitution he owed. Judge Goldsmith determined that total fraud loss was $25,308,216 and the restitution Dumouchelle owed was $25,206,401. The Court also ordered Dumouchelle to forfeit $12 Million for the fraud he committed. Following his release from prison, Dumouchelle will serve a three-year term of supervised release.

“White collar criminals may use sophisticated methods and apparently legitimate businesses, but their crimes amount to nothing more than lying to get money. Victims were often targeted because of their involvement in the jewelry investment, purchase, and auction trade, or were family members and friends of Dumouchelle. Victims were lulled into believing Dumouchelle’s false promises because he held himself out to be an expert with valuable connections that would provide them substantial profits.” said United States Attorney Dawn N. Ison.

“This defendant defrauded investors by convincing them he was buying and selling rare jewelry for big profits,” said James A. Tarasca, Special Agent in Charge of the FBI’s Detroit Division. “Instead of actually conducting those transactions, Dumouchelle used the victims’ money to help maintain his expensive lifestyle. The success of this investigation is the result of a strong partnership between the Birmingham Police Department and the FBI’s Detroit Metropolitan Identity Theft and Financial Crimes Task Force.”

The investigation was conducted by the FBI and prosecuted by Assistant United States Attorney Karen Reynolds.