Mahaveer Kankariya and Atul Shah are alleged to have arranged for the men to carry out the diamond raid – which made headlines for its similarity to a scene in Guy Ritchie's film Snatch – on New Year's Eve 2008.
They are said to have attempted to disable their shop's CCTV system by pouring drain cleaner on it, but failed, resulting in potentially incriminating images being preserved.
This meant authorities found footage of them emptying the safe and filling it "with empty jewellery boxes" that were "strewn around the room by the fake robbers," prosecutors said.
"They were going broke, they tried a desperate gamble," said Eugene Hurley, an Assistant District Attorney, at the trial in Manhattan. "They arranged a fake robbery to collect $7 million." Prosecutors said the video footage also showed how strangely inept the theft had been. "No real robbers would ever act like these guys," Mr Hurley said.
The scheme is said to have been discovered when Lloyds of London grew suspicious at inconsistencies in the jewellers' accounts of the robbery.