SYDNEY (JTA) — Mining magnate “Diamond” Joe Gutnick, once ranked among the wealthiest men in Australia with a fortune totaling more than $230 million, has declared bankruptcy.
Gutnick, who is an ordained rabbi, made his fortune in gold and diamond mining on the advice of the last Lubavitcher rabbi, the late Rabbi Menachem Mendel Schneerson.
Gutnick declared bankruptcy on July 8, ahead of a court hearing July 11 to hear a petition by his former business partner Indian Farmers Fertilizer Cooperative, or IFFCO, which was seeking to have him declared bankrupt over a $41 million debt. Gutnick lost a legal arbitration decision over the $103 million partnership that began in 2008 with India’s largest fertilizer collective.
Gutnick’s statement of affairs, obtained by Fairfax Media, shows he owes 25 creditors at least $210 million, and has no other assets except for $12,235 in savings and a worthless portfolio of shareholdings.
The $210 million collapse ranks him alongside the biggest bankruptcies in Australian history, although he still lags behind the $450 million owed by high-profile businessman Alan Bond when his empire crumbled.
Gutnick claims to have many overseas creditors, including $25 million to one “N Sternberg” of New York and a further $10.1 million to “Machne Israel” of New York, according to Fairfax Media.
Schneerson had told Gutnick after the 1987 stock market crash to go back to the Australian desert and search for “gold and diamonds.” Gutnick was responsible for overseeing the discovery of the Plutonic gold deposit, as well as the discovery, development and operation of the Bronzewing and Jundee gold mines in Australia, which all earned him the nickname “Diamond Joe.”
In 2010, Gutnick returned to the Business Review Weekly Rich List with an estimated wealth of $230 million following an absence of more than 10 years. At the time he owned a string of small mining companies that were exploring for everything from diamonds and gold to uranium and phosphate. He was still among Australia’s 200 richest people in 2014, when BRW estimated his wealth to be more than $190 million.
He did not respond to JTA’s request for a comment.