Suits accuse Newport Beach philanthropist of fraud scheme

Jeweler Mordechai ‘Moti’ Ferder resigned from his corporate position in May.

- SARA CARDINE

MOTI and Idit Ferder attend a Guilds of Segerstrom Center dinner in 2017. He is being sued by parties including Lugano Diamonds & Jewelry, which he founded.

A Newport Beach businessman has been named in numerous lawsuits alleging he engaged in fraudulent and illegal actions involving the diamond business he founded in 2005 and the private-equity firm he sold the outfit to for $256 million in 2021.

Mordechai “Moti” Ferder, founder and chief executive of Newport Beach’s Lugano Diamonds & Jewelry, resigned from his position with parent company Compass Diversified effective May 7 and, according to one lawsuit, is living abroad and transferring his assets out of California as legal threats mount.

Well known in local philanthropic circles, Ferder was touted as the man behind the $2.5-million donation that allowed the Orange County Museum of Art to offer free admission for a decade after its grand reopening in 2022. Just three weeks before his resignation, the jeweler was profiled by Forbes on his many charitable causes.

Multiple complaints filed in county and federal courts since early June contend Ferder entered into unpermitted outside contracts with wealthy individuals, soliciting funds to either acquire interest in or, with additional Lugano funds, purchase diamonds with the agreement the parties would split the profits.

Some of the transactions provided the third parties with initial returns, which Lugano alleges in its own lawsuit against Ferder were charged to the company as business expenses. But at some point, the funds ran out, leaving multiple investors holding the bag, suits allege.