Jeweller Nirav Modi, who is wanted in a multi-crore banking fraud in India, allegedly sold fake diamond rings to a Canadian national that cost him US$200,000, his girlfriend and also pushed him into depression.
According to a report in the South China Morning Post, Paul Alfonso, who had no clue Modi was involved in a US$2 billion fraud at India’s Punjab National Bank, bought two rings from the diamantaire in Hong Kong to propose to his girlfriend. Their celebration was cut short after the duo found out that the diamonds were fake.
According to the report, Alfonso met Nirav Modi in 2012 at the centennial celebrations for the Beverly Hills Hotel in 2012. Months later, they ran into each other in Malibu and dined together. Adding that Modi was giving him “pep talk, kind of an older brother figure,” Alfonso, who is the chief executive of a payment processing company, said he felt a “good connection” with Modi. “In a way, I admired him and I looked up to him.”
A couple of years passed without any communication between the duo. In April this year, Alfonso, utterly unaware of the financial irregularities cases listed against Modi, mailed the diamond jeweller asking for “special” engagement ring at a budget of US$100,000 to propose to his girlfriend. On offer from Modi was a “perfect” 3.2-carat round brilliant diamond cut, D colour, VVS1 – a high-quality grade and colourless stone at US $120,000. “Thank you for thinking of me when you’re making one of the most meaningful purchases in any man’s life,” Modi reportedly wrote after Alfonso approved the design.
Alfonso’s girlfriend, however, expressed interest in another ring prompting him to order a second ring — a 2.5 carat oval diamond for US$80,000 from Modi. After Alfonso wired the money for both rings to a Hong Kong account, he received the rings from Modi’s assistant Ari in June. The invoice and authenticity certificates were to be wired soon. Alfonso, who was ecstatic with the “absolutely gorgeous” jewellery, proposed to his girlfriend with both rings. The answer was “yes”.
Both Alfonso and his fiancee wanted the rings to be insured but the certificates had still not arrived. Feeling “uncomfortable,” he wrote to Modi reminding him of the same. Several emails followed, with Modi providing more assurances that the certificates were on their way.
In August, Alfonso was in for a rude shock when his fiancee, who took the rings to an appraiser, found that the stones were fake. “When she told me, I was like ‘That’s impossible. I spent US$200,000 on those rings. There’s no way they are fake. It’s Nirav we are talking about’.” he said.
The realisation that he has been duped dawned on Alfonso when he read the news about Modi’s bankrupt companies and loan defaults. “I am usually very careful when I am dealing with a big transaction like this, but again, this is Nirav. I would not imagine him trying to take a few hundred thousand from me when a guy is worth millions of dollars.”
His fiancee broke up with him soon after. “We broke up literally after one or two days … It was just too much for both of us to handle. It does not make sense to her, because she says: ‘You are a pretty smart guy, how did you let someone scam you out of US$200,000 without making sure the transaction was legitimate?’” Alfonso told the South China Morning Post.
Alfonso slipped into depression and said, “after that, I could not function”. In an angry email to Modi on August 13, Alfonso wrote, “Do you have any idea what kind of pain you’ve cost me and my now ex-fiancée? … You’ve completely ruined such a wonderful occasion for me and her. You’ve ruined my life.”
The South China Morning Post further reports that the Canadian national has now filed an unlimited civil lawsuit against Modi with the Superior Court of California, suing him for US$4.2 million dollars. That includes US$200,000 for the value of the rings, US$1 million for punitive damages and another US$3 million dollars for emotional distress, pain and suffering. The hearing is scheduled for January next year.
Alfonso, however, realises it too well that his case may take years to be resolved. “I realised that even if I go after this guy, there are so many creditors before me who are trying to get compensated.”