Diamond stolen in $20M London heist found at Manhattan jewelry

A massive 16-carat yellow diamond that was nicked in a $20 million jewel heist in London has popped up at a jewelry appraiser in Manhattan, court papers say.

The Gemological Institute of America identified the big bauble that was taken to them for an appraisal by a Hong Kong pawn shop as being the same one that was stolen from Graff Diamonds by Bentley-driving bandits back in 2007.

The sensational robbery took place in July 5, 2007, when two well-dressed men rolled up to the Graff store on London's Sloane Street in a chauffeured Bentley Continental Flying Spur. They were allowed through the store's airlock and past two security guards into the store, where they started talking diamonds with the employees.

Then the men pulled out silver handguns and announced they were robbing the store, helping themselves to necklaces, rings, pendants, earrings and diamonds before taking off in their $130,000 Bentley.

No arrests were ever made in the case, despite video of the dapper duo in action. London authorities alerted international diamond buyers and stores about the theft, but there had been no reports of the gems surfacing - until last January.

That's when the GIA, a non-profit that grades and certifies gams, contacted Graff to say that a yellow diamond that had been submitted to them from Yao On Pawn was their stolen loot. It had been "recut and reconsituted as 16.28 carat modified cushion cut diamond," court papers say.

The GIA was sure it was the same stone because it had "analyzed, graded and certified" Graff's 16.64 carat diamond before it was stolen and had detailed information on it, the filing says.

Graff demanded the diamond's return, but Yau refused - so now the jeweler is suing to get it back.

Yau "was and/or should have been aware that the diamond was sold to it in violation of the rights of the true owner," the suit says, and the "diamond must be immediately delivered to Graff."

The gem is being held at the GIA's New York lab pending the outcome of the court fight, the suit says.