Michael Mastro and his wife were arrested in France, they said Wednesday.
The real estate developer was forced into bankruptcy in 2009 after the market crashed. He owed his creditors about $325 million.
Mastro and his wife fled after failing to comply with a court order to turn over diamond rings worth $1.4 million.
"I think one was about 26 or 27 carats -- about the size of an Indian arrowhead, if you've ever seen one of those. And the other ring, I think, was a 17-carat nearly-perfect diamond," said James Rigby, a trustee appointed to the Mastro case by the Department of Justice.
Warrants had been issued for their arrest.
"It's a good day for the bankrupcy system," said Rigby. "I think he's thumbed his nose at the judge and the system here, and he was not going to provide us with the information he's required to."
In January, hundreds of items formerly owned by Mastro were put up for auction in Palm Desert, Calif., where he recently lived. The items included a 2007 Bentley convertible, a baby grand piano, designer fur coats, hundreds of bottles of wine and about two dozen Dale Chihuly glass sculptures.