2 diamond dealers get prison in fake NYC heist

Two diamond dealers were sent to prison Friday for more than a year for staging an elaborate heist in hopes of snaring insurance money to save their failing business, a crime their attorneys sai...

Two diamond dealers were sent to prison Friday for more than a year for staging an elaborate heist in hopes of snaring insurance money to save their failing business, a crime their attorneys said was driven by desperation.

"Every day for the rest of my life, I will carry the sin of this case. Every day for the rest of my life, I will live with the fact that I have brought this sin and terrible hardship on my entire family," said Atul Shah, apologizing and sobbing before he and Mahaveer Kankariya were sentenced to 20 months to five years behind bars.

Shah, 49, and Kankariya, 45, were convicted in March of engineering a New Year's Eve 2008 stick-up with flourishes fit for a caper movie: bandits disguised as Hasidic Jews, wearing fake beards and brandishing realistic-looking toy guns as they seemingly forced Shah to open a safe and empty it of gems. Police found plastic ties, duct tape and disarray when they arrived.

Actual video footage told a different story. Security camera images — captured on a device that prosecutors said the dealers tried unsuccessfully to destroy with drain cleaner — showed Shah and Kankariya had replaced many of the jewels in the safe with empty boxes just hours before the purported hold-up. The supposed robbers sometimes put the boxes they'd just grabbed back in the safe and mishandled the plastic ties they used to restrain Shah and an employee.

After the jewelers made a $7 million insurance claim, insurers and authorities became suspicious as it emerged that the jeweler's businesses were in hundreds of thousands of dollars in debt.

The men, both immigrants from India, shared offices in Manhattan's Diamond District. Kankariya's company, Real Creations, dealt in jewelry; Shah's business, Dialite Imports, bought and sold loose diamonds.

While insurer Lloyd's of London ultimately didn't pay the claim, it spent large sums investigating it, attorney Owen B. Carragher Jr. told the court.

Shah and Kankariya maintained throughout their trial that they really were robbed. But their lawyers said Friday the gem dealers now accept responsibility.

Shah "has lost everything," said his lawyer, Benjamin Brafman, who said Shah's relatives face the possibility of losing their home. "Most important, he has lost his honor and his name."

About two dozen of the men's relatives lined courtroom benches at the sentencing.

Kankariya didn't speak at his sentencing, but lawyer Michael Bachner said he was "enormously remorseful."

"As a result of serious financial issues, they just messed up," Bachner said.

Kankariya made matters worse for them after the trial by asking a bail bondsman if there was "any way I can bribe the judge ... because in my country, you know, we normally do that" and asking about removing his electronic monitoring ankle bracelet, according to the bondsman's testimony at a hearing in March. State Supreme Court Justice Thomas Farber then jailed both jewelers, who had been free on bond.

Kankariya regrets the remarks, made as part of a conversation about cultural aspects of how the U.S. and Indian justice systems work, Bachner said Friday.

"This was not an event that was ever really going to happen," he said.

Shah had nothing to do with Kankariya's remark, Brafman said.

Farber said Friday that he wouldn't let the episode influence his sentencing decision, though he called the notion of bribing a judge "incredibly upsetting."

"It just kind of rocks my world, for lack of a better word," he said.

His sentence was near the one-to-three year minimum for their conviction on insurance fraud and other charges; they could have faced up to 25 years in prison. The range in their sentence reflects the possibility of parole.

Farber himself had found them guilty, as they decided to forgo a jury.

"I believe I am dealing with men who are basically good people who did bad things," Farber said before sentencing them. But, he added, "I have two people in front of me who were raised in loving and supportive families and who should have known the difference between right and wrong — who were raised to appreciate that you don't lie, and you don't steal."

Another jewelry dealer was arrested last year on accusations that he acted as one of the costumed robbers, but the case against him was dismissed. No other suspects have been charged.

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