MajorsAug 06, 2025
Claire’s Files for Chapter 11 Bankruptcy AgainMajorsNov 18, 2025
Lugano Diamonds Files for Bankruptcy, Looking for Buyer
The Chapter 11 filing follows the resignation of CEO Moti Ferder, who stepped down after an investigation into the company’s finances.
Lugano Diamonds’ store in Greenwich, Connecticut, which opened in 2023. The jewelry retailer filed for Chapter 11 bankruptcy protection this week.
Newport Beach, Calif.—Lugano Diamonds & Jewelry Inc. filed for Chapter 11 bankruptcy protection Sunday and is seeking a buyer.
The bankruptcy filing follows the departure of the high-end jewelry manufacturer and retailer’s CEO and co-founder Mordechai “Moti” Ferder in May.
Ferder resigned after a preliminary investigation by parent company Compass Diversified revealed “irregularities” in its financing, accounting, and inventory practices, announced in an 8-K filing.
Compass, a private equity firm, acquired a majority interest in the retailer in 2021 for $256 million, with Ferder retaining 40 percent of Lugano Diamonds.
In documents filed Sunday in bankruptcy court, Lugano’s Chief Restructuring Officer J. Michael Issa said the company appeared to be “a highly profitable and rapidly growing business” up until early spring 2025 when Compass started looking into its books.
Its revenue and operating income appear to have been overstated, he said, and the amounts are being revised to reflect “substantially lower” numbers.
Issa stated that within weeks of Compass’ 8-K filing, Lugano Diamonds heard from nearly 60 individuals who said they were involved in “investment contracts” with Ferder that were “outside Lugano Diamonds’ ordinary course of business.”
In most cases, these contracts were joint investment agreements in which a third party would co-invest in a loose diamond, ostensibly for resale at a “significant profit.”
Since the summer, around a dozen parties have filed lawsuits against Lugano Diamonds, Ferder, and other related parties, Issa said in the filing.
On June 24, Lugano Diamonds sued Ferder alleging fraud, concealment, constructive fraud, and breach of fiduciary duty.
Ferder is accused of concealing and misrepresenting the nature of the above-mentioned financial transactions. Lugano said these contracts created liabilities for the company, with Ferder allegedly disguising them as direct sales.
“He forged invoices and sale documents, sent out empty box shipments, falsely recorded the money from the third-party individuals as revenue for Lugano [Diamonds], and concealed the payment obligations from Lugano [Diamonds’] books,” stated Issa.
In a statement emailed to National Jeweler, Ferder’s attorney, Jeffrey Reeves of Reeves & Weiss LLP, said that Ferder denies the allegations made against him and is “profoundly disappointed” that the company he founded has filed for bankruptcy.
Reeves said the evidence will show that the proceeds from the investment contracts went directly to Lugano and that no funds were directed to Ferder or any entity under his control.
He added that Lugano’s management and Compass Diversified were “fully aware of these activities and knowingly accepted the financial benefits from them.”
The lawsuit is “a clear effort to misdirect accountability for the company’s action, performance, and ultimate failure, which occurred after Mr. Ferder’s departure from leadership,” said Reeves.
“Mr. Ferder is confident that the judicial process will bring the full truth to light and that he will be vindicated.”
Related stories will be right here …
The bankruptcy filing follows the departure of the high-end jewelry manufacturer and retailer’s CEO and co-founder Mordechai “Moti” Ferder in May.
Ferder resigned after a preliminary investigation by parent company Compass Diversified revealed “irregularities” in its financing, accounting, and inventory practices, announced in an 8-K filing.
Compass, a private equity firm, acquired a majority interest in the retailer in 2021 for $256 million, with Ferder retaining 40 percent of Lugano Diamonds.
In documents filed Sunday in bankruptcy court, Lugano’s Chief Restructuring Officer J. Michael Issa said the company appeared to be “a highly profitable and rapidly growing business” up until early spring 2025 when Compass started looking into its books.
Its revenue and operating income appear to have been overstated, he said, and the amounts are being revised to reflect “substantially lower” numbers.
Issa stated that within weeks of Compass’ 8-K filing, Lugano Diamonds heard from nearly 60 individuals who said they were involved in “investment contracts” with Ferder that were “outside Lugano Diamonds’ ordinary course of business.”
In most cases, these contracts were joint investment agreements in which a third party would co-invest in a loose diamond, ostensibly for resale at a “significant profit.”
Since the summer, around a dozen parties have filed lawsuits against Lugano Diamonds, Ferder, and other related parties, Issa said in the filing.
On June 24, Lugano Diamonds sued Ferder alleging fraud, concealment, constructive fraud, and breach of fiduciary duty.
Ferder is accused of concealing and misrepresenting the nature of the above-mentioned financial transactions. Lugano said these contracts created liabilities for the company, with Ferder allegedly disguising them as direct sales.
“He forged invoices and sale documents, sent out empty box shipments, falsely recorded the money from the third-party individuals as revenue for Lugano [Diamonds], and concealed the payment obligations from Lugano [Diamonds’] books,” stated Issa.
In a statement emailed to National Jeweler, Ferder’s attorney, Jeffrey Reeves of Reeves & Weiss LLP, said that Ferder denies the allegations made against him and is “profoundly disappointed” that the company he founded has filed for bankruptcy.
Reeves said the evidence will show that the proceeds from the investment contracts went directly to Lugano and that no funds were directed to Ferder or any entity under his control.
He added that Lugano’s management and Compass Diversified were “fully aware of these activities and knowingly accepted the financial benefits from them.”
The lawsuit is “a clear effort to misdirect accountability for the company’s action, performance, and ultimate failure, which occurred after Mr. Ferder’s departure from leadership,” said Reeves.
“Mr. Ferder is confident that the judicial process will bring the full truth to light and that he will be vindicated.”
According to court documents, the jewelry retailer’s assets are valued at an estimated $100 million to $500 million, while its liabilities range from $500 million to $1 billion, owed to between 200 and 999 creditors.
The retailer has reached an agreement with investment firm Enhanced Retail Funding to help continue operations during the sale process.
Lugano Diamonds said its stores will remain open during the bankruptcy process.
Enhanced Retail Funding also will serve as the stalking-horse bidder, meaning its bid will serve as the baseline during the sale process and other higher offers will be considered.
To further fund its operations through the bankruptcy process, Lugano filed a motion seeking approval of a $12 million debtor-in-possession financing facility that would provide up to $10 million of new liquidity.
Upon court approval, the money will be used to continue to pay employee wages and benefits, maintain customer programs, and fulfill obligations to vendors and partners.
“We are deeply grateful to our dedicated employees, clients, partners, and community for their ongoing support,” said Josh Gaynor, interim CEO of Lugano.
“As this process is underway and we approach the holiday season, we look forward to continuing to provide our valued clients with unique, timeless pieces for themselves and their loved ones.”
Founded in 2004 by Ferder and his wife, Idit, Lugano Diamonds, operates seven stores in affluent cities including Aspen, Colorado, and Palm Beach, Florida.
Lugano recently closed its London boutique, as per court documents, and is in the process of closing its Greenwich, Connecticut, and Washington, D.C. stores.
The next hearing in the retailer’s bankruptcy case is scheduled for Wednesday morning at the U.S. Bankruptcy Court for the District of Delaware in Wilmington.
More on Majors
The Latest
TrendsFeb 17, 2026
A Bit of Jewelry for the Year of the HorseWestern wear continues to trend in the Year of the Fire Horse and along with it, horse and horseshoe motifs in jewelry.
SourcingFeb 17, 2026
Colored Gemstone Experts Talk Tariffs, Trends in TucsonAlthough the market is robust, tariffs and precious metal prices are impacting the industry, Stuart Robertson and Brecken Branstrator said.
GradingFeb 17, 2026
Dr. George Rossman, Former GIA Governor, Dies at 81Rossman, who advised GIA for more than 50 years, is remembered for his passion and dedication to the field of gemology.
Brought to you by
The MJSA Mentor & Apprenticeship Program: Attracting & Training the Next Generation of Bench JewelersLaunched in 2023, the program will help the passing of knowledge between generations and alleviate the shortage of bench jewelers.
CrimeFeb 13, 2026
JSA Offering $10K Reward in Nancy Guthrie Case Guthrie, the mother of “Today” show host Savannah Guthrie, was abducted just as the Tucson gem shows were starting.
Weekly QuizFeb 12, 2026
This Week’s QuizTest your jewelry news knowledge by answering these questions.
IndependentsFeb 13, 2026
97-Year-Old New Mexico Jewelry Store To CloseButterfield Jewelers in Albuquerque, New Mexico, is preparing to close as members of the Butterfield family head into retirement.
CollectionsFeb 13, 2026
A ‘Rosebud’ Necklace for Valentine’s DayPaul Morelli’s “Rosebud” necklace, our Piece of the Week, uses 18-karat rose, green, and white gold to turn the symbol of love into jewelry.
Brought to you by
How Jewelers Can Fight Back Against Cell JammersCriminals are using cell jammers to disable alarms, but new technology like JamAlert™ can stop them.
CollectionsFeb 12, 2026
British Museum Raises $5M to Keep Jewel Linked to Henry VIII, Katherine of AragonIt is believed the 24-karat heart-shaped enameled pendant was made for an event marking the betrothal of Princess Mary in 1518.
SourcingFeb 12, 2026
‘Cotton Candy’ Necklace, 35-Carat Kunzite Win 2025 ‘Buyer’s Choice’ AwardsThe AGTA Spectrum and Cutting Edge “Buyer’s Choice” award winners were announced at the Spectrum Awards Gala last week.
Events & AwardsFeb 12, 2026
Kering Opens Entries for 2026 Sustainability-Focused AwardThe “Kering Generation Award x Jewelry” returns for its second year with “Second Chance, First Choice” as its theme.
TrendsFeb 11, 2026
Halle Berry’s Retro Engagement Ring Is a Sapphire-Set StunnerSourced by For Future Reference Vintage, the yellow gold ring has a round center stone surrounded by step-cut sapphires.
MajorsFeb 11, 2026
Francesca’s Files for Chapter 11 Bankruptcy AgainThe clothing and accessories chain announced last month it would be closing all of its stores.
CollectionsFeb 11, 2026
Zales Turns Sweethearts Into Jewelry for Valentine’s Day CollectionThe “Zales x Sweethearts” collection features three mystery heart charms engraved with classic sayings seen on the Valentine’s Day candies.
TechnologyFeb 11, 2026
Gemvision Symposium 2026 Slated for AprilThe event will include panel discussions, hands-on demonstrations of new digital manufacturing tools, and a jewelry design contest.
Events & AwardsFeb 11, 2026
TJS Announces Roundtable, Launches New AppRegistration is now open for The Jewelry Symposium, set to take place in Detroit from May 16-19.
SourcingFeb 10, 2026
At Meeting in South Africa, Support for Natural Diamonds Picks Up Steam Namibia has formally signed the Luanda Accord, while two key industry organizations pledged to join the Natural Diamond Council.
TrendsFeb 10, 2026
Bad Bunny Wears Football-Shaped ‘Desert Diamond’ for Halftime PerformanceLady Gaga, Cardi B, and Karol G also went with diamond jewelry for Bad Bunny’s Super Bowl halftime show honoring Puerto Rico.
SurveysFeb 10, 2026
Shoppers to Spend Big on Jewelry This Valentine’s Day, Says NRFJewelry is expected to be the No. 1 gift this year in terms of dollars spent.
FinancialsFeb 10, 2026
Kering Plans Transformation as 2025 Sales Sink 13%As star brand Gucci continues to struggle, the luxury titan plans to announce a new roadmap to return to growth.
SourcingFeb 10, 2026
AGTA To Debut ‘Stuller Color of the Year’ Spectrum Awards CategoryThe new category asks entrants for “exceptional” interpretations of the supplier’s 2026 color of the year, which is “Signature Red.”
Policies & IssuesFeb 09, 2026
U.S., India Trade Deal One Step Closer to Being FinalizedThe White House issued an official statement on the deal, which will eliminate tariffs on loose natural diamonds and gemstones from India.
Events & AwardsFeb 09, 2026
JA Now Accepting Entries for 2026 CASE AwardsEntries for the jewelry design competition will be accepted through March 20.
IndependentsFeb 09, 2026
James Free Jewelers Unveils Revamped FlagshipThe Ohio jeweler’s new layout features a curated collection of brand boutiques to promote storytelling and host in-store events.
TrendsFeb 09, 2026
These 14 Jewels Will Melt Your Heart This Valentine’s DayFrom heart motifs to pink pearls, Valentine’s Day is filled with jewelry imbued with love.
CrimeFeb 06, 2026
Florida Man Sentenced After Selling Fake Native American Jewelry for a Decade Prosecutors say the man attended arts and craft fairs claiming he was a third-generation jeweler who was a member of the Pueblo tribe.
FinancialsFeb 06, 2026
Pandora’s North America GM Departs Amid Executive ChangesNew CEO Berta de Pablos-Barbier shared her priorities for the Danish jewelry company this year as part of its fourth-quarter results.
