A big diamond snatched by Bentley-driving bandits in a brazen, 20 million US dollar London robbery has popped up in a Hong Kong pawn shop, said a jeweller who is suing in New York to try to get it back.

The more than 16-carat yellow diamond was among those snatched in a July 2007 hold-up at a Graff Diamonds Ltd branch in London, the jeweller said in a suit filed last week in Manhattan state Supreme Court.

A pair of sharply dressed bandits stepped out of a 250,000 US dollar Bentley Continental Flying Spur, pretended to be shoppers and chatted up store staffers before brandishing handguns and stealing diamonds and gem-studded rings, necklaces, pendants and earrings, Graff and police said at the time.

The Hong Kong shop later submitted the diamond for certification to the Gemological Institute of America, a New York-based non-profit organisation that grades and identifies jewels, the lawsuit said.

The institute, which had certified the diamond before the robbery, determined the pawn shop had presented the very same gem, although it has been re-cut, Graff's lawsuit says.

"Graff is and was the true owner of the diamond and entitled to immediate possession of the diamond," but the pawn shop will not let the institute return the gem, the lawsuit says.

It is silent on the stone's value. The lawsuit says the institute has the diamond at the moment while it awaits resolution of the ownership dispute.

Sam Hung, a director at the Yau On pawn shop in Hong Kong, said he was not aware the diamond was stolen when the shop bought it. "When I received the diamond, I had documentation about where I bought it but I had no method of knowing the source (of the diamond). But we did pay for it - we're a pawn shop. We are now negotiating. My lawyers said maybe we could come to a compromise about how much we need to pay to get it back before the court case starts," Mr Hung said.

Mr Hung said he paid about three million Hong Kong dollars (386,000 US dollars) for the diamond.

The institute said it could not discuss the matter because of the dispute but noted that it regularly works with law enforcement when stones are reported lost or stolen.