The jewelry industry isn’t as glitzy as it seems, especially for those on the trade show circuit.
These jewelers travel from city to city, selling their wares to wholesalers and shoppers at convention centers crowded with booths under harsh light.
It was after one such expo in San Mateo, Calif., when 14 of these companies were victimized in the heist of a Brink’s big rig at a Grapevine truck stop on July 11. The high-profile crime at the Flying J Travel Center — which could be among the biggest jewelry thefts ever — has spotlighted their close-knit world.
In interviews with The Times, jewelers described a business built on handshake deals, generous favors and well-earned trust. It’s work that hinges on artful salesmanship and requires long days competing for customers — but also fosters a sense of camaraderie among jewelers who have made it a way of life. Now, however, the heist has upended this tightknit community, decimating the 14 companies whose merchandise was stolen in Lebec while en route to the L.A. area for another trade show. The size of the haul is in dispute, with estimates ranging from less than $10 million to more than $100 million.
One of the victims, Jean Malki of Forty-Seventh & Fifth Inc., said that telling his children about the theft was the toughest thing he’s ever done.
“They always looked at me — I’m their hero, I’m the tough guy,” he said. “I didn’t want to break that image for them. So I told them: Everything’s gonna be OK, but for now we’re going to have some changes. Inside I was torn apart and devastated.”
An evidence photograph provided by the FBI shows a sampling of jewelry taken in the Flying J heist in July.
(FBI)
The alleged circumstances of the heist have upset some of the jewelers, who questioned Brink’s efforts to secure their gems, gold, jewelry and watches. Shortly after 2 a.m., thieves “cut away” the rear lock of the armored big rig and stole 22 large bags of booty during a 27-minute period in which one of the drivers snoozed inside the vehicle’s sleeping berth and the other was getting food at the Flying J, the company has said.
“How could this thing happen with Brink’s?” wondered Kenny Lee, one of the affected jewelers and one of at least eight victims based in Los Angeles County. “They were not taking care of our goods.”
Before the Brink’s tractor-trailer departed for its doomed trip to the Southland, jewelers at the San Mateo County Event Center had been alerted to a potential security issue. While jewelers were packing up their booths at the conclusion of the fair July 10, a representative of the International Gem and Jewelry Show warned them over the loudspeakers that there were “suspicious” people outside the event center and to be mindful of that while departing, according to three people who were there.
Such warnings are common at the jewelry show, having increased in recent years, according to an employee of the organization, who requested anonymity over safety concerns.
Arnold Duke, president of the jewelry show, did not respond to interview requests.
The Los Angeles County Sheriff’s Department, which is working on the case with the FBI, so far has said little about the inquiry. Investigators believe that the heist was the work of sophisticated criminals, given the lack of violence and the speed of the thieves’ work, among other factors.
Jerry Kroll, attorney for the 14 jewelry companies, said that his clients are cooperating with the FBI and have provided investigators with images of their stolen merchandise and, in one case, passed on a tip that a jeweler received via voicemail. He declined to discuss details of the information shared in the voicemail message.
The total value of the loot is the subject of two lawsuits filed in August: one lodged by Brink’s against the affected jewelry companies, and another brought by the jewelers against the Richmond, Va., security and logistics giant.
Brink’s alleged in its lawsuit that the stolen items had a declared total value of $8.7 million — a figure it said was drawn from agreements signed by its jewelry business customers. The complaint seeks to limit any payout Brink’s could have to make to the jewelers to that amount, alleging they “substantially under-declared the value of their shipments.” (Some jewelers have said they assigned their merchandise lower values than their fair-market costs to reduce shipping fees.)
The jewelry businesses alleged in their complaint against Brink’s and other parties that the unnamed tractor-trailer drivers’ conduct was “grossly negligent” — and that “lax security” by the company allowed the theft to occur. The lawsuit for alleged breach of contract and additional claims said the jewelry companies’ merchandise was worth about $100 million. It seeks at least $200 million in restitution and damages.
Kroll said that Brink’s should offer a reward for the return of the stolen merchandise. His clients, he said, “are not in a financial position” to do so.
“Brink’s snoozed and their customers lose — they should be the ones putting up the reward, not the victims, who have been wiped out,” he said. “My clients thought their goods were in safe hands with Brink’s.”
Connelia Savage, Brink’s general counsel for North America, said in a statement to The Times that “loss incidents are rare,” and it is the company’s practice “to reimburse our customers for properly submitted claims up to the full declared value of their property.”
“We do it promptly, so that our customers can get back to business with minimal disruption,” said Savage, also a senior vice president at Brink’s. “We immediately contacted the Brink’s customers impacted by this incident to begin the reimbursement process.”
Inside the business
The Flying J heist has exposed a quirk of the jewelry trade that is further complicating matters for those whose valuable wares were stolen.
The Flying J Travel Center, just west of the 5 Freeway in Lebec, was the site of a Brink’s truck jewelry heist in July.
(Myung J. Chun / Los Angeles Times)
It is common practice, jewelers said, to obtain inventory without paying for it upfront. The method, which is akin to consignment, is known as buying “on memo,” and it allows jewelry companies to take on pricey items without paying for the merchandise until it has sold.
The loss of the jewelers’ inventory has been compounded by the fact that in at least four of the cases, the stolen items included those held “on memo.” Lee, who owns Supreme Gems Corp., is one such victim. Beyond the financial issues, he worries about his standing in the industry.
“With my reputation — built for so long — people trust me,” said Lee, who founded Supreme Gems’ predecessor company in 1992. “Vendors don’t even ask me for money right away: They give me items on consignment. Now, I have to pay them. I don’t feel good. This is not my normal life. I can’t bring my face downtown and let people see me.”
Lee said that the cost of his stolen inventory — 1,300-plus items his company amassed over roughly 30 years — was at least $12 million. He is still calculating what he believes to be their fair-market value, but by his estimation, Supreme Gems’ lost merchandise alone dwarfs the $8.7-million valuation that Brink’s has attributed to all of the stolen shipments combined.
But, like some of the other victims, Lee gave the items he shipped with Brink’s a declared value of $400,000. “We never thought to insure it for more because it was so costly, so expensive,” he said.
With the loss of their merchandise, some of the jewelers are forgoing upcoming trade shows. They are missing out not only on the business opportunities but also the fellowship that comes with their line of work. Some of the trade shows cater to the general public, and others are open only to wholesale shoppers. The shows, Malki said, attract an eclectic milieu: “You see the $5 people there, and you see the $500,000 people there.”
“There is always excitement,” he said.
For jewelers who’ve grown accustomed to traveling for work, being homebound is a precarious turn of events.
“I only work hard, and if I am not working I will be at home — and so lonely,” said victim jeweler Amy Kit Tsing Leung, who operates Hawaiian Designs Jewelry Inc. with her husband. “I want to run my business and work normally. But now … everything is gone.”
Leung said that the cost of her stolen merchandise was at least $700,000, and she is still calculating its fair-market value. Like Lee, she assigned her goods a declared value of $400,000 because a higher sum would make it “too expensive to ship.”
At 83, Leung, whose business is based in the San Francisco Bay Area, is among the oldest jewelers to travel from city to city to showcase wares at jewelry and gem expositions. Now, the roughly 40-year veteran of the industry isn’t sure what she’ll do.
Her dismay stems in part from the fact that she had been helping other veteran jewelers who no longer could travel for the shows — in some cases due to the COVID-19 pandemic — by selling their merchandise for them. And their items were part of Hawaiian Designs Jewelry’s stolen cache.
“They trusted me,” she said. “Many, many days, I cannot sleep…. When I close my eyes, I think about it too much.”
Soldiering on
Moving forward hasn’t been easy, several jewelers said. Those who have decided to keep their jewelry companies open now are tasked with rebuilding their inventories at a time when their finances may be limited and the issue of lost “on memo” items looms.
And whether it’s relating the episode to relatives or tallying lost inventory, unpleasant reminders of the heist abound.
Malki, co-owner of Forty-Seventh & Fifth since 2012, said that his company lost more than 650 pieces of jewelry, watches and other items. Among them were a trove of high-value timepieces, including about 30 Rolex watches and others made by Patek Philippe, Vacheron Constantin, Cartier, Bulgari, Franck Muller and Corum.
The declared value of his stolen wares was $100,000, Malki said. He declined to disclose the fair-market value of those items but said it was “way more” than the declared value.
Malki gave The Times an interview over lunch in Pasadena and kept his composure throughout the meeting — until he detailed the conversation he’d had about the theft with his children. Malki struggled to contain his emotions as he shared his 7-year-old daughter’s attempt to cheer him up after his disclosure of the crime.
“She said, ‘Dad, don’t worry, I’m gonna have a lemonade stand,’” Malki said. “She gave me the biggest hug.”
The inventory of a jeweler whose wares were photographed at the International Gem and Jewelry Show this year. Nearly all of the merchandise was later stolen in the Flying J heist.
(Handout)
For Lee, the Flying J heist brought back dark memories of another loss of his inventory: In 1996, he was followed home from work and robbed at gunpoint.
It was, Lee said, a “total loss.”
At the time, Lee did not have insurance — he said he could not afford it — and also lost merchandise he had held on memo. “I owed money in the marketplace,” he said. “I had to build my reputation and business again.”
But Lee said that elder statesmen of the L.A. jewelry trade — among them people who’d given him merchandise on memo — came to his aid. “They were nice,” he recalled. “They said, ‘Kenny, you don’t have merchandise, you are young. Although you lost everything, you pay me whatever you lost later on, but I will still give you merchandise.’”
This time, though, the Flying J heist is a much larger loss. And the theft of Supreme Gems’ inventory has forced Lee to forgo participating in the International Gem and Jewelry Show, which returns to the San Mateo County Event Center on Friday.
“How can I [attend] the show right now?” he asked.
Malki said he will be there, explaining that he needs to “put food on the table,” and also log face time with his customers. “If there’s a big gap between you and your customers,” he said, “you just lose them.”
But returning to San Mateo will be difficult.
“It makes me feel like I’ve been violated,” he said. “To go back to that scene — I don’t know how I’m going to deal with it.”
He paused before adding: “I don’t think I have a choice.”
