Sorry to say, there's nothing the NY Attorney General's office can do but store the complaint in public record and take action if a large number of other people file similar complaints against this store. The Attorney General's office just doesn't have the resource to go after every personal injustice done in the consumer world, especially when you haven't really lost any money over it. You'll have to go to small claims court to force him to trade in or refund your diamond, which is just a matter of going down to the courthouse and filing the necessary paperwork with a small fee, then pleading your case to a judge.
It's a shame that he sold you a diamond of such poor quality that he himself wouldn't take it back.
It's a shame that he sold you a diamond of such poor quality that he himself wouldn't take it back.