Editors

The Nirav Modi Case: What Else We Learned This Week

EditorsMar 02, 2018

The Nirav Modi Case: What Else We Learned This Week

An affidavit filed Thursday maps out the connection between the Indian diamantaire and his U.S. companies that filed for bankruptcy.

2017_gavel-stock.jpg

A lot of questions came to mind Tuesday as I was working on the story about the bankruptcy filing of the three U.S. companies—Firestar Diamond Inc., Fantasy Inc. and A. Jaffe—ultimately owned by Nirav Modi, the Indian diamantaire at the center of a $1.8 billion bank fraud scandal.

How are they all connected to Modi? Is it accurate to say that he owns them?

Why a Chapter 11 filing in a case like this, beyond the obvious?

And what will happen to these three companies going forward?

Late Thursday afternoon, an affidavit was filed that helped to answer at least some of my questions.

The Modi Connection
Press reports about the Chapter 11 filings mainly used the word “owned” to link Modi and these U.S. operations, which isn’t inaccurate. But his ownership of the company is neither direct nor simple.

Ian Winters, the New York attorney handling the companies’ Chapter 11 case, said Tuesday that Modi was not an officer or a director in any of the three U.S. companies and was not involved in their day-to-day operation.

A. Jaffe, too, was quick to point out that its team here had no knowledge of what was happening in India. The second sentence of its statement on the bankruptcy filing read: “A. Jaffe and its core team here in the United States want to assure partners and customers that A. Jaffe is not in any way involved with any of the alleged conduct that is the subject of the accusations.”

According to the affidavit, Firestar Diamond Inc. was formed as a Delaware corporation in February 2004 as Jewelry Solutions International Inc. The name of the company changed three times over the next seven years, to Next Diamond Inc. (2005), Firestone Inc. (2007) and, finally in 2011, to the name it has now, Firestar Diamond Inc.

Fantasy Inc. was incorporated in Delaware in 2012 and is a wholly owned subsidiary of Firestar Diamond Inc.

A. Jaffe Inc., which traces its roots back to 1892, incorporated in New York in July 1975 under the name Sandberg & Sikorski Diamond Corp. In 1995, the company dropped the “Diamond” from its name before changing it again in 2011 to A. Jaffe Inc.

Firestar Diamond Inc. is a wholly owned subsidiary of Firestar Group Inc., a Delaware corporation. Firestar Group is owned by another Delaware corporation, Synergies Corp.

Synergies is a wholly owned subsidiary of a Hong

Kong company called Firestar Holdings Ltd., which is a wholly owned subsidiary of an Indian company called Firestar International Ltd., of which Nirav Modi is “directly or indirectly” the majority shareholder, the affidavit states.  

A. Jaffe Inc., meanwhile, is 95 percent owned by Synergies, with founder Sam Sandberg holding the remaining 5 percent.

Do you need an Advil now? If so, feel free to grab a couple. I’ll wait.

Now, remember that conversation I reported on last week with the banker, in which he talked about how bankers are put off by the industry’s lack of transparency? This “spaghetti junction” of organization, as another industry insider described it, is exactly what he was talking about. 

Why Chapter 11?
There’s a section of the affidavit titled “Events Leading to the Chapter 11 filing” that, after running down the allegations against Modi, points to the same factor that Winters mentioned to me on the phone Tuesday when I was interviewing him about the bankruptcy filing.

Modi’s factories in India that made most of the jewelry for Firestar Diamond, Fantasy Inc. and A. Jaffe were seized and shut down, which, the affidavit points out, resulted in thousands of people losing their jobs. The Indian entities also provided Firestar/Fantasy and A. Jaffe with back office and support functions.

That’s a sad reality of situations like this—that everyday working people lose their livelihoods because of the ego and greed (or, in this case still, alleged greed) of big corporations or individuals—and it shouldn’t be forgotten.

It’s also worth noting that job losses are what the principals of Firestar/Fantasy and A. Jaffe are trying to prevent from happening in the United States.  

Chapter 11 gives these three companies a chance to reorganize either with new owners or investors, provided they can find some who are willing and also can navigate the legalities of selling companies that are connected to an alleged, international white-collar crime.

Firestar Diamond International and Fantasy Inc. do about $90 million in sales a year, according to the affidavit, selling to big companies like Signet-owned Zales, Kay Jewelers, and Jared the Galleria of Jewelry, as well as Costco, Sam’s Club, Walmart and J.C. Penney. The company also holds the IP for the Endless Diamond brand.

A. Jaffe’s market is more upscale—it sells to “hundreds of the finest independent jewelry stores in America,” the affidavit states—and the company has been growing steadily over the past three years, with fiscal 2018 sales projected to reach $23 million.

Both businesses are looking for a buyer, and the affidavit told me the same thing that Winters did on the phone earlier this week: that “early expressions of interests” have been “strong.”

What About the Nirav Modi Stores?
This is not something that was included in the affidavit and is not connected to any of the three companies above, but I do want to talk a little bit about what we know about Modi’s stores in the U.S.

As I noted in my blog post last week, Modi has (or seemingly had) three eponymous stores here.

The first was on Madison Avenue in New York, with stores in the Wynn Las Vegas and the Ala Moana Center outdoor mall in Honolulu opening this past November.

On Thursday, the only phone number I could find online was for the New York store. When I called it, I got an automated message from Time Warner.

The Hawaii store is still listed on the Ala Moana website, but when I called during business hours Thursday, neither a machine nor a human answered.

At the Wynn Las Vegas, I didn’t see Nirav Modi listed among the shops on the hotel’s website. I reached out to the hotel’s public relations department Thursday but didn’t hear back, though it is fair to note that they might have their hands full relating to the public on other matters.
Michelle Graffis the editor-in-chief at National Jeweler, directing the publication’s coverage both online and in print.

The Latest

Silvia Furmanovich Kasmir Collection Carnelian Bracelet and Sketch
CollectionsJul 23, 2025
Silvia Furmanovich’s ‘Kashmir’ Collection Is a Tribute to Northern India

The “Kashmir” collection features centuries-old craft techniques made in collaboration with the region’s master papier-mâché artisans.

LAFD Fire Station 44 and Fire Station 16
IndependentsJul 23, 2025
IJO Raises Nearly $37K for LA Fire Relief

Two Los Angeles Fire Department stations plan to use the donations to upgrade their equipment and tools.

Bench jeweler holding a bracelet and a tool
IndependentsJul 23, 2025
Montreal’s Ecksand Eyes Move to SoHo

Creative Director Erica Bianchini shared why the jeweler is looking to expand into the U.S. and how it’s putting Canadian craftsmanship on the map.

rio-article photo-diamond.jpg
Brought to you by
Taking the Moment Head On: How Rio Grande Champions the Present & Future of Fine Jewelry

As a leading global jewelry supplier, Rio Grande is rapidly expanding and developing new solutions to meet the needs of jewelers worldwide.

Stock image of crime scene tape
CrimeJul 23, 2025
JSA Warns of Violent String of Smash-and-Grabs in California

JSA has received reports of mobs swarming jewelry stores, driving cars into the storefront or smashing through the windows.

Weekly QuizJul 17, 2025
This Week’s Quiz
Test your jewelry news knowledge by answering these questions.
Take the Quiz
A Vanitas by Hannah Martin and Guy Berryman Sothebys
CollectionsJul 22, 2025
Jewelry With a Rock ‘n’ Roll Aesthetic Heads to Sotheby’s London

Next week, the auction house will kick off a selling exhibition of jewelry by British artist Hannah Martin and Coldplay’s Guy Berryman.

Cover of the book “Flawless: Inside the Largest Diamond Heist in History”
SourcingJul 22, 2025
Antwerp Diamond Heist Documentary Coming to Netflix

“Stolen: Heist of the Century” is based on “Flawless,” the book about the middle-of-the-night theft, and will debut on Netflix in August.

an instructor and a student in a bench jewelry classroom
Brought to you by
Investing in the Next Generation of Bench Jewelers

The Seymour & Evelyn Holtzman Bench Scholarship from Jewelers of America returns for a second year.

Emmanuel Raheb
ColumnistsJul 22, 2025
The Gifting Gap: How to Market Jewelry Beyond the Holidays

Emmanuel Raheb shares the top five gifting moments outside of major holidays that jewelers should build marketing campaigns around.

NY Now
Events & AwardsJul 22, 2025
NY Now’s Summer Market Returns in August

The wholesale trade show’s Luxury Lifestyle section will showcase established and emerging jewelry designers.

Jeweler setting a diamond into a ring
MajorsJul 21, 2025
Rio Grande Expands Personalization Offerings

As demand for custom jewelry grows, the company is expanding its services to support retailers.

National Associate of Jewelry Appraisers Logo
Events & AwardsJul 21, 2025
NAJA’s 2025 ‘Ace It’ Conference To Go Virtual

The mid-year conference for jewelry and watch appraisers is slated for Aug. 9 to 10 on Zoom.

Jacquie Aiche graduated turquoise beaded necklace
TrendsJul 21, 2025
Amanda’s Style File: Graduated With Honors

Graduated stones make for elevated tennis-style pieces and dramatic statement necklaces.

24th Gem Awards Show Logo
Events & AwardsJul 21, 2025
Gem Awards Now Accepting Nominations for 2026

Nominations in the categories of Jewelry Design, Media Excellence, and Retail Innovation will be accepted through July 30.

Lewis Heyman
MajorsJul 18, 2025
Lewis Heyman on Sourcing Gemstones, Post-Retirement Plans

He retired last month after 28 years traveling the world to source the very best gemstones for his family’s jewelry business, Oscar Heyman.

CCWW Designs Multiple Shell Charm Necklace
TrendsJul 18, 2025
Piece of the Week: CCWW Designs’ Shell Charm Necklace

The charm necklace features six nautical charms of shells and coral that founder Christina Puchi collected on Florida’s beaches.

The Plumb Club board members
MajorsJul 18, 2025
Plumb Club Elects New Board Members

The organization elected its youngest vice president as it looks to draw in fresh talent.

Jewelry industry veterans Brad Campbell and John Liebler
TechnologyJul 18, 2025
Brad Campbell, John Liebler Join Clientbook’s Executive Team

Campbell joins the company as vice president of business development while Liebler is the new vice president of operations.

Silver, Gold, and Bronze Medals for Italy Olympic Winter Games
CollectionsJul 17, 2025
2026 Winter Olympic Medal Design Symbolizes Unity

The medals feature a split-texture design highlighting the Games’ first time being hosted by two cities and the athletes’ journeys.

vimeo screenshot.png
Supplier BulletinJul 17, 2025
The INSTORE Jewelry Show 2025: Your Holiday Preparations, All Wrapped Up!

Sponsored by The INSTORE Jewelry Show 2025

Guinness
SurveysJul 17, 2025
The Most Recommended Brands in the World, According to YouGov

Globally, travel and transportation brands reigned, while in the U.S., alcoholic beverage companies and a lingerie brand took the top spots.

Gina Ferranti
IndependentsJul 17, 2025
Gina Ferranti of GiGi Ferranti Jewelry Dies at 59

The Brooklyn-based jewelry designer is remembered as a true artist and a rare talent.

Rio Tinto Chief Executive Simon Trott
SourcingJul 17, 2025
Rio Tinto Names New CEO, Production Rises at Diavik

Production at the mine in Canada’s Northwest Territories topped 1 million carats in Q2, the third consecutive quarter of growth.

Jewelers of America Learning Workship Logo
Events & AwardsJul 17, 2025
JA to Hold Learning Workshops This Fall

A new slate of Learning Workshops will take place in Oklahoma, Mississippi, and Georgia.

Gold bracelets and bangles
SurveysJul 16, 2025
Signet Jewelers Falls Lower on NRF’s ‘Top 100’ Retailers List

The middle class is changing its approach to buying jewelry and affordable luxury goods, the NRF said.

Buccellati Opera high jewelry bracelet
FinancialsJul 16, 2025
Richemont’s Jewelry Sales Up 7% in Q1

It marks the third consecutive quarter of growth for Cartier, Van Cleef & Arpels, Buccellati, and Vhernier.

Rolex Datejust ref. 16233
WatchesJul 16, 2025
The Top-Selling Rolex Models of the Last 15 Years, According to Bob’s Watches

The reseller’s market trends report, based on its sales data, also shows exactly how much Rolex prices have jumped since 2010.

×

This site uses cookies to give you the best online experience. By continuing to use & browse this site, we assume you agree to our Privacy Policy