Posted at: 02/01/2012 7:00 PM
By: David Springer

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Zumbro Falls 'Diamond Merchant' Pleads Guilty to Federal Charges

(ABC 6 News) -- A Zumbro Falls man has plead guilty for his involvement in something rarely heard of in Minnesota selling stolen gemstones.

But there's more, the Zumbro Falls man also plead guilty to taking part in a Rochester drug ring that's been operating since the mid 90's.

Richard Kay has plead guilty to federal charges of transportation of stolen goods across state lines. Federal officials say the gemstones were first stolen from Sterling Jewelry in Ohio with the help of an unnamed co-conspirator.

"And this unnamed co-conspirator stole the gemstones from Sterling (Jewelry, Inc.) and then Kay transported them from Ohio to Minnesota and then re-sold them under the name Kay Diamonds," said Jeanne Clooney, spokesperson for the U.S. Attorney's Office.

Kay is currently out on bond and we attempted to contact him at his lakefront home in Zumbro Falls this morning. He wasn't home, but neighbors say he's lived there for about 5 years.

"Couldn't ask for a nicer guy." Neighbors describe Richard Kay as a very friendly person, a single man with a dog, who first identified himself to them as a diamond broker who traveled often.

But his neighbor, who didn't want to be identified also remembers when his home was raided back on St. Patrick's Day.

"They were here for at least 4 hours. It looked like a live cop show basically."

The Feds say Kay also plead guilty to taking part in a Rochester drug ring that sold high quality marijuana for as much as $5,000 a pound. Four Rochester men also plead guilty for their part in the drug ring. They are Jamie Allen Davidson, Jason Ray Meek, Shawn Robert Milliken and Brandon Christopher Lusk. 

"They actually admitted that the marijuana was transported from other states to the Rochester area," said Cooney. "There they stored it in storage units and in their homes."

And because these are federal charges, all the property in question, including at least 5 locations in Rochester and Kay's Zumbro Falls property, could be seized by the federal government.

All five men are facing potential life in prison sentences for their crimes. However a sentencing date has not yet been set.

Richard Kay is in no way associated with the national chain, Kay Jewelers.