Jewellery boss in £170m scam told shop staff to pretend to be customers

Staff at a luxury jewellery retailer were told to pose as customers to trick investors in the UKs biggest diamond scam, BBC Panorama can reveal.

The deception helped diamond dealer Vashi Dominguez get fresh cash from investors to prop up his business, which collapsed in 2023 with £170m of debts.

Those investors lost everything when the Vashi retail chains promised £157m stock of diamonds was later only valued at about £100,000.

Vashi disappeared, but both the Metropolitan Police and the Serious Fraud Squad have decided not to investigate.

BBC Panorama has spoken to former shop staff, investors and the financial experts combing through the wreckage of the company to piece together how Vashi fooled so many people - and to ask why authorities are not looking for him.

"This is bigger than Hatton Garden, Brinks-Mat and the Great Train Robbery combined," says one of the investors, Michael Moszynski, an advertising executive.

Vashi Dominguez made his name supplying diamonds to the rich. His reputation grew as his diamond deals grew bigger.

He appeared on ITVs This Morning, chatting with Holly Willoughby and Phillip Schofield, holding a crystal egg, which he claimed was worth £5m and he was selling for a billionaire in Canada.

"Vashi is very dynamic, hes a very charismatic character. He was almost like the Pied Piper of jewellery retail," says Will Hayward, a former Vashi store manager.

By 2017, Vashi was no longer just a diamond dealer to the rich. He was a High Street brand, with Vashi stores in London, Birmingham and Manchester.

Vashi said he was offering a different kind of jewellery experience, where customers could work with designers and then watch their jewellery being made on site. They were promised high-end diamonds at a cheaper price.

"Vashi was quite a magnetic individual," says Mr Moszynski. "He had gravitas, he had intelligence, he spoke in a very informed way about every detail of his business."

Vashi backed up his ideas with detailed business plans and accounts. He tricked experienced investors like Clive Schlee, the former boss of the sandwich chain Pret a Manger, and John Caudwell, the mobile phone billionaire.

Mark Schneider, a media executive who co-founded GB News, decided to invest about £750,000. "It seemed good. Some smart guys from around here were in the deal, I just kind of went along with it on that basis," he says.

The business seemed to be booming. In 2021, Vashi opened a new flagship store on a prime site in Covent Garden, central London. It was fitted out extravagantly, with a large interactive screen and an £8,000 sofa, staff say.

But on the shop floor, they suspected something was not right.

"After the shininess had worn off, we were getting, like, two, three, four people in it a day, and that was the reality in one of the busiest squares in London," says Charlotte Paul, a former data analyst for Vashi.

Vashi tried to bring in more money by tricking investors, telling staff to pretend to be customers so the store would look busy.

An email spelled out why: "This request is direct from Vashi, as he is in major investor conversations and expects surprise store visits."

Sales staff with no experience of making jewellery were also told to sit at work benches and pretend to be goldsmithing or diamond-setting.

"It was a whole elaborate show that Vashi would do with the clients, to show that theyve got so many orders and this is how busy we are - this is why you should really be investing into Vashi," says Will Hayward.

"Total facade."

Customers were also being conned, staff say.

Diamonds for sale usually carry inscriptions that record their size and quality, called a GIA number.

Lezlie Bailey, who worked as a gemologist at Vashi, says the company was buying smaller or lower-quality diamonds than customers had paid for and scratching off the GIA numbers.

But the biggest trick Vashi used to cheat investors was in the accounts.

The figures sent to investors - and published at Companies House - showed sales of more than £100m in 2021.

But they were false. Internal documents show the real sales figures that year were only £5m - just 5% of the published figures.

"To completely misrepresent the accounts by this scale is just completely unacceptable," says Stuart McFadden from fraud investigation company Refundee, which represents some investors.

Vashis company was on its knees, but the man himself was still living the good life. The company paid for his fleet of luxury cars, including a Lamborghini, and the rent for several flats in prime central London neighbourhoods such as Mayfair.

It could not last - and in April 2023, the glitzy jewellery retail business went bust.

Investors were shocked but thought their money would be safe, because they had been sent valuations in February showing the companys huge stock of diamonds was worth £157m.

But they learned this had been another trick. Diamond consultant Rob Wake-Walker, who was brought in to value the gems that April, says: "Our first question was actually to ask if there was any more."

The valuation of the diamonds and the dodgy accounts had been signed off by a real accountant: Rajnikant Patel, who works from a small office on a row of shops in Ilford, east London.

He did not answer our letters, so I went to see him and asked where the missing money had gone.

Mr Patel said he did not know where the money was and did not want to discuss what happened, in case it prejudiced any future court case against Vashi.

Asked about the investors who had lost money, Mr Patel said he did not think anyone based their decision to invest "purely on our accounts".

"Obviously its not good. The shareholders, the investors have lost their money. I certainly am very sorry thats happened, but nothing to do with us," he said.

Mr Patel said he did not know the figures in the accounts were wrong and would not have signed them off if he had known.

The liquidator, Benji Dymant, says creditors are owed £170m and that more than £100m of that is owed to investors. Mr Dymant would like to question Vashi, but he has vanished.

His disappearance also means the BBC was unable to put our allegations to him.

From bank statements, Mr Dymant says he knows Vashi flew to Dubai on the day the court ordered the company to be wound up.

"We have hired private investigators and there have been sightings of him, but we have not been given any hard evidence of a sort of residence or location in a certain place," the liquidator says.

Vashi has cheated investors, staff and the taxman, but the search party is surprisingly small.

There is no investigation by the police or the Serious Fraud Office (SFO).

Investors are stunned that nothing is being done. "I mean, what are you actually doing?" says Mark Schneider, who is American. "All these people in your country can be ripped off in such an obvious way and you dont bother trying to figure out how to get hold of the person or to deal with the fraud."

Investors say they were passed between the Metropolitan Police and the SFO, until the SFO eventually said it was not a complex-enough case for it to take on.

The SFO told us it only "takes on a small number of high-level economic crime cases" each year.

The Met Police told us it had "not received any referrals from the liquidator or the Insolvency Service" and would reassess if it did.

The liquidator says he is not allowed to tell us whether he referred the case to the police or the SFO.

Investors think Vashi Dominguez committed the perfect crime and escaped with a fortune.

But the liquidator, who has gone through the books, says there is no evidence that he has taken a lot of the missing cash.

"What we havent seen from the bank statements is significant bulk sums of money, or any obvious sums of the money, that have been put into an offshore account or anything like that," says Mr Dymant.

Like most investors, Mark Schneider has not got his money back. He still cannot work out whether Vashi was a scam from the beginning.

"Im not sure whether the guy panicked because this thing just wasnt working like he planned or whether he planned it all along to be like this," he says.

What we know is Vashi Dominguez used sparkle and glamour to attract tens of millions of pounds from investors.

All the money has gone and so has he.