Staff Told to Pose as Customers in £170m Vashi Diamond Scam, BBC Panorama Reveals

Staff at a luxury jewellery retailer were instructed to pose as customers to help convince investors to inject fresh funds into the business, BBC Panorama has reported, in what some investors describe as the UK's biggest diamond fraud.

The firm, run by diamond dealer Vashi Dominguez, collapsed in 2023 with around £170 million of debts. Investors were told the retail chain held roughly £157 million of diamonds in stock, but independent valuations later placed that inventory at about £100,000. Dominguez left the UK after the collapse and, according to Panorama, both the Metropolitan Police and the City of London Police’s Serious Fraud Squad have decided not to open formal investigations.

Panorama interviewed former shop staff, investors and financial experts who have been combing through the company's records. Those interviewed said that staff members were routinely told to act as customers and stage sales activity in order to create the appearance of steady demand and substantial stock. That staged activity, they said, was then used as evidence to persuade new and existing investors to provide capital to prop up the company.

Former employees described pressure to participate in the deception. Investors and market experts told Panorama that the apparent discrepancy between the levels of claimed stock and later independent valuations pointed to systematic misrepresentation. One investor, advertising executive Michael Moszynski, described the affair as on a scale beyond other well-known UK heists and frauds, saying, "This is bigger than Hatton Garden, Brink's-Mat and the Great Train Robbery combined."

Dominguez, who built a brand supplying diamonds to wealthy clients and whose reputation grew as his deals grew larger, denied wrongdoing in public statements reported previously, saying his business model had been misrepresented by critics. He has not been seen in the UK since the business collapsed and attempts to trace his whereabouts have been reported by Panorama.

Those who lost money include private and institutional investors who had been shown documentation and in-store demonstrations that purported to show large diamond inventories and strong retail throughput. After the collapse, independent auditors and jewellery specialists were reportedly unable to verify the existence or value of the stocks claimed on company balance sheets.

Legal and policing sources cited by Panorama said the Metropolitan Police and the Serious Fraud Squad reviewed referrals but concluded there was insufficient evidence to launch criminal inquiries. The decisions not to open a formal investigation have prompted criticism from investors and legal advisers involved, who say they have been left without recourse and with significant losses.

Several investors told Panorama they had been reassured by the atmosphere in stores and by face-to-face demonstrations of goods. Former staff said the illusions were crafted to appeal to high-net-worth clients and potential backers, leveraging the company’s retail presence to endorse claims about the quality and quantity of diamonds the business held.

Financial analysts who examined available documents said the company’s reported assets and turnover were inconsistent with independent market measures. Where legitimate diamond stock is tightly tracked and independently verifiable, the valuations presented to investors in this case did not match later appraisals performed after the company failed.

Panorama's reporting also highlighted calls from affected parties for a more thorough probe by authorities and for stronger regulatory oversight of high-value, low-transparency markets such as diamonds. The jewellery trade typically involves complex supply chains and valuations that can be difficult for non-specialists to verify, bolstering the importance of independent appraisal and stricter investor due diligence, experts said.

Representatives of the retailers, investors and policing bodies cited in the Panorama report were approached for comment during the programme's preparation. The Metropolitan Police and the City of London Police previously confirmed to media inquiries that they had considered the matter but had not opened criminal investigations; they did not provide further detail on the rationale for those decisions in the Panorama coverage.

The collapse of the Vashi business and the scale of reported investor losses have prompted renewed scrutiny of how luxury goods are presented to and vetted by potential investors. Those affected continue to seek answers about how publicly visible retail operations and staged activity were used as part of the evidence presented to backers, and why those signals did not trigger earlier regulatory intervention.

Panorama's investigation adds to mounting public accounts from former employees and investors aiming to reconstruct the final years of the company and the chain of events that led to its insolvency. Legal advisers and financial experts interviewed for the programme said they are continuing to review records to determine whether civil or regulatory actions could still be brought by creditors and investors.