Ralph Esmerian was taken into custody by U.S. Postal Inspectors in New York City on Monday morning (22Nov10) for bankruptcy and wire fraud.
The former owner of vintage jewellery retailer Fred Leighton is accused of double-pledging pieces from his gem collection to secure the huge loans to finance his business, reports the New York Post.
He is then said to have sold the items and kept the proceeds for himself when the Fred Leighton firm went bankrupt in 2008, allegedly lying to the Bankruptcy Court during that time. He lost control of Fred Leighton last year (09).
Esmerian has been released from jail on a $3.5 million (£2.3 million) bond.