Billy Lulo was arrested by the FBI following a 10-month investigation. He is charged with one count of mail fraud and was fired on Wednesday.
According to the Los Angeles Times, Lulo, who owns a Los Angeles jewelry store, was given the diamond to sell, and when asked for the jewel back, he allegedly sent an empty package.
Lulo, 47, has since been released and is scheduled to appear in court sometime in September. He was hired as a reserve deputy in 1990 and was assigned to the Century Station.