Celebrity jeweler Jacob Arabov, known in the hip-hop world as “Jacob the Jeweler,” has been sentenced to 30 months in federal prison for lying to investigators in a case involving the laundering of drug profits, the Associated Press reports.
Arabov pleaded guilty in October 2007 to falsifying records and giving false statements as part of a deal with federal prosecutors.
Prosecutors asked U.S. District Judge Avern Cohn to impose a minimum sentence of three years and one month. Cohn, however, today sentenced Arabov to a total of two years and six months, citing Arabov’s extensive charity work, the AP reports. He also ordered Arabov to pay a $50,000 fine and to make a $2 million forfeiture to the government.
Authorities accused Arabov and others of conspiring to launder about $270 million in drug profits for the “Black Mafia Family,” a ring that operated out of the Detroit area beginning in the early 1990s. A seven-year investigation culminated in Arabov’s arrest in 2006 and the indictments of Arabov and at least 41 others.
A favorite among hip-hop artists and rappers, Arabov launched a line of religious-themed jewelry with Kanye West and manufactured Lil’ Kim’s line of Royalty watches.
Arabov will report to prison on January 15, 2009.
The net profit of Indian company Flawless Diamond grew 141% to $1.97 million in the fourth quarter of the fiscal year 2007-08, the Bombay Stock Exchange reports.
The company producing diamond jewelry informed that its net sales in the three reporting months (to 31 March 2008 inclusive) went up 34% to $37.16 million.
Flawless Diamond’s net profit for the full fiscal year soared 246% to $5.87 million.
The company’s net sales during the year increased 86% to $130.9 million, whereas its expenses were up 82% reaching $123.78 million.
As of March 31, 2008 the company was operating 19 retail outlets branded “246% to 5.87.”
Rajesh Exports, an Indian jewelry manufacturer, displayed fairly good sales-boosted profit in the fourth quarter of the fiscal year ended March 31, 2008.
The company reported that sales in the above period increased 41% to $589 million, while its net profit was up 47% reaching $11.41 million.
For the full fiscal year the company reported a 25.7% sales hike hitting $2.02 billion, whereas its expenses grew 24% to $1.96 billion. Its net profit for the reporting period almost doubled scoring $48.17 million to $23.62 million one year ago.
The United Nations Children’s Fund (UNICEF) has cut ties with billionaire diamantaire Lev Leviev due to his suspected involvement in building Israeli settlements in the occupied West Bank, according to a letter sent from the organization to activist group Adalah-NY.
According to the letter, sent from Chris de Bono, UNICEF’s senior advisor of communications for the executive director, UNICEF will no longer consider “partnerships—direct or indirect—with Mr. Leviev or any of his corporate entities, and will not accept financial or other support that we know is from him or his corporate entities.”
In a letter to Adalah-NY dated March 25, 2008, UNICEF explained that Leviev had indirectly supported UNICEF three times, “each time as a sponsor of fund-raising activities organized by the French magazine Gala in support of UNICEF.”
UNICEF’s rejection of Leviev’s support followed meetings with Adalah-NY, letters from organizations and Palestinian communities advocating a boycott of Leviev’s companies, and a visit by UNICEF officials to Jayyous, one of the Palestinian communities where a Leviev company is allegedly building Israeli settlements, according to Adalah-NY.
Leviev’s diamond-mining companies in Angola have also been accused of serious human rights abuses.
Officials from Dubai, United Arab Emirates, have also announced that they would not allow Leviev to open planned jewelry stores in the region following boycott calls issued by Adalah-NY and Palestinian communities, Adalah-NY reports.
The “LEVIEV” high-end diamond boutique opened in Moscow’s Kuznetski Most is the third boutique, after London’s Old Bond Street and New York City’s Madison Avenue stores belonging to the Israel diamond mogul. Lev Leviev’s company is calling this its first Eastern European flagship store.
The Moscow boutique located at the corner of Kuznetski Most and Petrovka will comprise two floors of retail and private salons. The luxury of diamonds displayed at the store will be emphasized by the wealth of its interior: taupe pleated silk paneled walls, marble, ivory and bronze showcases and mohair sofas, pink silk chairs and ivory leather-clad desks.
The boutique will house a wide gamut of men’s and women’s diamond jewelry and watches, as well as a variety of precious colored gems and pearls.
Besides this new “LEVIEV” boutique, the Israel billionaire owns a large network of jewelry stores in Russia belonging to the Moscow Jewelry Plant, which he controls.
On June 25, American jewelry company House of Taylor Jewelry (HOTJ) announced it was closing up shop. The announcement came after the news of terminating licensing agreements with Elizabeth Taylor and Kathy Ireland, owners of trademarks for products supplied by HOTJ. The company also said it was in default of its loan of at least $11.2 million. In its filing to the U.S. Securities and Exchange Commission HOTJ says it has not enough current capital to continue its business and has no assets to offer as collateral to attract borrowed funds.
The company turned bankrupt was under financial pressure in recent months. In April 2008, HOTJ failed to file its financial report on time and was delisted by NASDAQ.
HOTJ’s would-be results for 2007 (unaudited) appeared deplorable. Its gross sales dropped 35.7% ($12 million) compared to 2006, while its net sales were mere $200,000, a decrease of 99.3% ($31.6 million) toward 2006. The slump in net sales was due to enormous sums of actual and expected sales returns for the amounts of $12.5 million and $8.9 million respectively. The company’s losses in 2007 may reach a record of $14.8 million.
De Beers is upping the ante on the number of retail stores it plans to open worldwide, according to an interview of its Group Managing Director Gareth Penny to the Wall Street Journal.
In the interview, Gareth Penny told the WSJ that while the company’s retail business is still in its “start-up phase,” it is rapidly expanding, with plans to have a total of about fifty stores worldwide by the end of the year.
Penny told the WSJ that this would make De Beers, whose stores are a joint venture with luxury company LVMH Moet Hennessy Louis Vuitton, “probably in the top five jewelry retailers in the world.”
When De Beers first made public the details of its retail plans, reports surfaced that the company would open 150 stores within 10 years, angering retail jewelers who complained of unfair competition.
Since then, information about the opening of stores has been reduced to a trickle, the National Jeweler writes.
In an interview in the June 2007 edition of National Jeweler sister publication Couture International Jeweler, De Beers executive Guy Leymarie was quoted as saying the company planned to have 30 stores by the end of 2007, but did not divulge further details about the company’s strategy.
Currently, the company has a total of seven stores in North America, with its latest opening in San Francisco at the end of June.
Jewelry company Van Cleef & Arpels recently opened its fourth store in the Middle East in cooperation with the company’s local partnership, the Ali bin Ali Group. The boutique was opened in the Centria Mall in the Saudi Arabian capital of Riyadh.
The new boutique will comprise a wide range of Van Cleef & Arpels jewelry, including its high-end jewelry, classical jewelry and bijoux styles.
The Ali bin Ali Group retails luxury watches and jewelry in the Middle East under its ABA Watches & Jewellery division.
Previously opened Van Cleef & Arpels stores in the region are located in Dubai, Abu Dhabi and Istanbul.
“We are very pleased with the positive response we have received since the opening of the Van Cleef & Arpels Boutique in Centria Mall. Saudi clients very much appreciate our jewelry and the message of femininity that it conveys,” said Stephane de Palmas, Van Cleef & Arpels Middle East director.
A recent consumer market study conducted by JCK–Harrison Group tow-netted some surprising results.
When asked the open-ended question, Thinking about fine jewelry, what brand or company comes to mind first? respondents named Zales, a retailer, as the No. 1 jewelry brand. Mall retailer Kay Jewelers ranked second, though it tied with Zales and Tiffany & Co. in aided recall.
The study polled 908 respondents who purchased fine jewelry within the previous two years. Curiously enough, the findings indicate that, even after long-term and stepped-up consumer advertising, the majority of jewelry consumers still think of the retailer—not the product brand—first.
Tiffany and Cartier, cited as Nos. 3 and 8 respectively, could be considered jewelry brands, but both have a strong retail component.
JCK’s 1999 study asked about brand familiarity using aided recall only. In the 1999 study the top four were Tiffany, Cartier, De Beers, and Van Cleef & Arpels.
In the years since that study, there’s been an increase in the number of jewelry advertising pages in magazines. Thus, one might assume such brands as Hearts On Fire and Scott Kay—household names in the industry—would be cited at least among affluent shoppers.
Yet they weren’t. Even breaking out results by income and region barely affected results. The top five names—Zales, Kay, Tiffany, Jared, and De Beers—remained the same.
Price has become even more of an issue with consumers since the advent of Blue Nile and other Web sites. Prices there are not only transparent but also often lower than jewelry-store prices for comparable items. Consumers are ready to pay more to buy an item from a jeweler, but they will insist on a valid reason for the higher price.
Douglas Hucker, executive director of the American Gem Trade Association, says jewelers worry about price competition from the Internet, but he sees department stores as the bigger threat.
