A former Wellington man who peddled diamonds from an office on Worth Avenue and gave millions to a West Palm Beach-area church has been charged with fraud for selling $30 million in fake gems to investors throughout the nation, federal prosecutors said Friday.
Jose Aman, who operated Eagle Financial Diamond Group, Natural Diamonds Investment Co. and a cryptocurrency business, is charged with wire fraud in connection with what federal prosecutors described as a Ponzi scheme.
The 51-year-old former director of the 3,000-member Winners Church on Jog Road, pleaded not guilty to the charge on Sept. 9. But, according to court documents, he plans to change his plea at a court hearing on Monday. Wire fraud is punishable by a maximum 20-year prison sentence.
Aman, who now lives in Woodstock, Va., worked with longtime Canadian radio personality Harold Seigel, and his son, Jonathan Seigel, according to documents filed by the U.S. Securities and Exchange Commission when it shut down the diamond investment operation in May 2019.
Scores of Canadians who heard Seigel’s long-running weekly radio broadcasts, trumpeting the wisdom of investing in diamonds, bought what they were told were rare colored diamonds, regulators said. The rough diamonds would be worth millions once they were cut and polished, they and investors throughout the nation were told.
With promises that their investments were protected by a 19.5-carat fancy deep green diamond valued at more than $22 million, people plunked down their cash, convinced they would receive 100% returns on their investments, according to court documents.
In a recent report, attorney Jeffrey Schneider, who was appointed to recover money for investors, said he had the “infamous diamond” appraised. It was worth less than $10,000.
The Seigels have not been charged and weren’t mentioned by name by prosecutors in documents charging Aman with wire fraud. Assistant U.S. Attorney Adrienne Rabinowitz said only that one of Aman’s partners hosted a radio show.
But, she said, investors were duped. Aman, she said, rarely used investors’ money to purchase rough diamonds, she wrote. Instead, he used it for himself.
Like all Ponzi schemes, he paid off some early investors, using money from those who invested later.
As the diamond-investment scheme was falling apart, Aman launched Argyle Coin, claiming he was going to develop cryptocurrency that would be backed by diamonds.
Instead, money washed back and forth between the diamond and the bitcoin companies to keep investors at bay, she said.
Aman lived well. He bought four show horses and donated roughly $2.1 million to Winners Church and two of its pastors. He rented luxury homes and cars, Schneider said in court records.
Winners Church Pastors Frederick and Whitney Shipman balked at returning $1.8 million Aman donated to the church.
Further, Frederick Shipman, who serves as bishop of the church, said he should be allowed to keep the roughly $700,000 he received from Aman. His son, Whitney, the senior pastor of the church, fought to keep the $41,000 Aman gave him.
However, U.S. District Judge Robin Rosenberg ruled that the money rightfully belonged to investors and ordered them to return it.
The $2.1 million represents the bulk of the money Schneider said he has recovered. The Seigels had tentatively reached a settlement with the SEC but it is mired in legal wrangling, according to court documents.
The Seigels “are very sympathetic to the victims of the Ponzi scheme alleged to have been orchestrated by defendant, Jose Aman,” their attorney, Elllen Kaplan, wrote in court papers.
Her clients, she said, have cooperated with federal regulators and were “never charged with fraud nor participation in the fraudulent scheme.”
This article originally appeared on Palm Beach Post: Worth Avenue diamond peddler faces fraud in $30 million scheme