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Ex-Owners of Renowned Paris Jewelry Firm Sentenced to Prison

December 17, 1991

PARIS (AP) _ Jacques and Pierre Chaumet once mingled with the cream of Europe’s aristocracy as scions of a centuries-old jewelry firm. On Tuesday, they were headed to prison, convicted of defrauding socialites and creditors of $100 million.

The brothers ″orchestrated the ruin of one of the most famous jewelry firms in the world - of all history,″ Judge Bernard Peyrat said in passing sentence. ″They’ve committed all the misdeeds possible in their profession.″

Despite that harsh assessment, the brothers were sentenced to two years or less in jail for fraudulent actions stemming from their attempt to avoid bankruptcy. The maximum they could have gotten was five years, in a country that does not send white-collar criminals to jail for long periods.

Given a rare glimpse into the world of wealth and privilege, French news media were captivated by the trial of the Chaumets, the ninth generation of a family whose customers included Napoleon, Britain’s Queen Victoria and countless other members of European nobility.

The three-week trial ended Oct. 23, but the verdict and sentencing were deferred until Tuesday, when the brothers were convicted of fraud, abuse of confidence and illegal banking practices.

According to testimony, the brothers obtained badly needed loans by overvaluing the firm’s assets, sometimes by listing clients’ jewels that had been entrusted to them for safekeeping.

Jacques Chaumet, 64, considered the financial expert of the firm, was sentenced to two years in prison. Pierre, 63, the creative force of the 210- year-old family business, received an 18-month sentence. Each was fined $95,000.

Neither of the impeccably dressed brothers nor their lawyers commented afterward, and there was no immediate indication whether they would appeal.

Peyrat reproached the brothers for displaying a ″sense of impunity, probably linked to their name.″ He said they exercised total control over their firm and always acted in concert.

The prosecutor, Christian Mellotte, said their acts were part of a carefully worked out, long-term plan, not a consequence of ″unfortunate financial difficulties.″

″I have been surprised by the almost lofty tone of their explanations and have the unpleasant feeling that they were strangers to their own wrongdoing, spectators at their own trial,″ Mellotte said.

The court estimated the brothers defrauded creditors and customers of more than $100 million. Several banks that lost millions are seeking large damage payments, but a final resolution of the claims must await the outcome of bankruptcy proceedings.

Chaumet’s main offices and flagship store are in the posh Place Vendome in Paris, across from the Ritz Hotel. There also are stores in New York, London, Brussels and Geneva.

The Chaumet family has controlled the firm since its founding in 1780. Among the pieces crafted by Chaumet jewelers was Napoleon’s ″Crown of Charlemagne,″ now on display at the Louvre.

The firm filed for bankruptcy in June 1987 after government investigators determined it was $300 million in debt. In July 1987, it was taken over by the Arab-owned bank Investcorp.

Several socialites testified against the Chaumets.

Minnie de Beauvau-Craon, a princess, described how the brothers sold off a 31-pearl necklace worth $180,000 after she had given it to them ″for safekeeping only,″ a family practice for generations.

Jacques Chaumet insisted she had requested an estimate and planned to sell. Only later did she have a change of heart, he said.

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