As you can see throughout this web site, many factors affect quality and value in diamonds. But you don’t have to be a “gemologist” or fear buying jewelry. You do need to be aware of the potential for fraud or misrepresentation in the jewelry industry.
Stone switching does occur occasionally and can be extremely disturbing because of the loss of value and the concern for making false accusations. Since the beginning of time, there have been some jewelers who take advantage of the typical customer who never paid close attention to their own diamond. The customer takes a high quality, but dirty diamond in for repair or appraisal and is returned a shiny and sparkly diamond several days later. It is in the same mounting and appears the same to the customer’s untrained eye. Of course the owner has not taken a close look at their diamond in years. If the unethical jeweler had switched the stone and replaced it with a similar size but lesser quality stone, they just generated thousands of dollars of tax free money. Think of all the watch batteries and gold earrings they have to sell to produce that same income.
To avoid unnecessary worry and prevent your diamond from being switched when you have it repaired or appraised, take notice of the following suggestions:
- Know your diamond. Note the color, type of girdle and clarity characteristics (chips, scratches, naturals, clouds, feathers, etc.) and their locations. These are characteristics you can observe with a loupe. A certificate is your best documentation because it records all the key quality characteristics.
- Record descriptive characteristics on the store’s receipt for any diamond you leave. While stores often don’t have time to determine accurate color and clarity grades, they should be willing to write down characteristics that are visible. This documentation not only serves as evidence in case of switching, it can actually help prevent it from occurring.
- If you have a diagram (i.e., certification) or photograph of your diamond, ask the store if it will serve as a fair representation of the item.
- Clean your diamond before you take it to be repaired or appraised. By examining the diamond in the same condition you will receive it back, you are more likely to recognize your diamond.
- Beware of jewelers who do repairs for unbelievably low prices. Perhaps a lack of experience or honesty may be the reason for such low prices.
- Try to establish a relationship with a jeweler you feel is trustworthy. Even then it does not hurt to make them aware that you have taken the precautions above.
While switching diamonds is outright fraud and theft, false representation can be equally dishonest. The Federal Trade Commission requires that a diamond be within one clarity and color grade of what it is originally sold as. Because of this, jewelers tend to “bump” the grade. For example, if a jeweler buys a stone as a SI1-H, he’ll bump it up and sell it as a VS2-G. If you buy it as a VS2-G and have it appraised as a SI1-H, the dealer is legally covered, because he sold it within one grade of what it really is.
For many years it was common practice for jewelers to “exaggerate” a diamonds color and clarity by two grading levels. The differences were difficult to discern with the untrained eye and the jeweler had control over both the situation and environment. They determined the lighting, the stones used for comparison, if any, and the words used to describe the diamond. Many of these jewelers were willing to put everything in writing, often including a full “appraisal.” Such dishonest practices often go undetected because most people assume when a seller is willing to “put it in writing,” he or she is properly representing the item. Most buyers never bother to have the facts verified. In recent years more and more shoppers ask to see certified diamonds which limits the ability to misrepresent the diamonds grading.
Advice: Always ask if the diamond is certified. If it isn’t, insist that the sale is contingent on the stone being certified or at the very least has received the same grading by an independent appraiser. The requirement of certification or examination by an independent appraiser should be enough to keep the jeweler from trying to bump the color and clarity grades.
Beware of jewelers not willing to put the facts in writing, but who offer to let you take the stone, prior to the sale, to an appraiser of their choice in the neighborhood. This may be a scam. If is often seen in wholesale districts like New York’s famous 47th Street. Many people are immediately hooked, and conclude erroneously that since they can get an appraisal if they choose, everything must be in order. So they don’t. And they become victims of intentional misrepresentation. Those who do wish to get an appraisal usually face another problem. They don’t know any appraiser, or certainly not any in the 47th Street neighborhood. Unfortunately, the “reliable appraiser” suggested by the seller often means the seller can rely on the appraiser to tell the prospective buyers what the seller wants them to hear.
Advice: Only use an independent appraiser if you are seeking another opinion. We provide a directory of independent appraisers for your convenience or you can seek your own.
Another common area of fraud is the development of extremely good looking imitations (also called simulants). These fakes can fool just about anyone, even diamond experts. Cubic zirconia, synthetic spinel, colorless glass and synthetic diamonds have flooded the market with stones that resemble real diamonds in many ways.
Scientists have succeeded in creating a new diamond imitation that is now entering the jewelry marketplace, synthetic moissanite (silicon carbide). It has recently made the news because it fools most electronic diamond testers, indicating “diamond” when tested! Fortunately, moissanite is lighter than diamond so weighing it is a quick way to separate it from diamond if the stone is loose.
In and of themselves, these imitations are not bad. They are a problem only when they are represented as real diamonds with prices many times higher than their true value. There are a variety of tests that can be performed to identify real diamonds but the best assurance is to purchase a certified diamond and then ensure the stone matches the certification characteristics.
Recent technologies for treating diamonds have produced another area of possible fraud. Fracture-filled diamonds and laser drilled diamonds are diamonds that have been treated to enhance their perceived beauty and quality. While these are legitimate treatments that do produce a more beautiful stone for less cost, the difficulty comes when these treatments are not disclosed to the buyer who therefore assumes the diamonds are untreated. Once again, the best method of ensuring your diamond has not had these treatments is to purchase a certified diamond and then match the stone to the certification.
Exposing off-color diamonds such as yellowish- or brownish-tinted stones to certain types of radiation can result in the production of fancy colored stones. This treatment produces rich yellows, greens, and blues, and greatly enhances salability because these colors are very desirable. In and of itself, radiation is not fraud; in fact, it may make a “fancy” color diamond affordable to someone otherwise unable to afford one. But again, just be sure that the stone is properly represented and you know what you are buying, and that you are getting it at the right price–which should be much lower than that of the natural fancy. Treated stones must be represented as “treated stones” and should be priced accordingly. GIA certifications indicate “Natural Fancy Yellow” color to indicate the diamond has not been treated.
Where possible, flaws are concealed by their settings. The good stone setter will try to set a stone in such a manner that the setting will help to conceal any visible imperfections. For this reason flaws near or at the girdle will downgrade a stone less than those found in the center of the stone; since settings cover all or part of the girdle, they are simply less visible there. Indeed, a setting can make a flaw “invisible.” There is nothing fraudulent in such uses of settings as long as the stone is properly represented. The only danger is that not only the customer but also the jeweler may not have seen the imperfection concealed by the setting. For this reason, important diamonds should be viewed and purchased loose.
When the average person is looking at a stone already set, it is very difficult, if not impossible, to see differences that can dramatically affect cost. For this reason, we usually recommend buying any important diamond loose and mounting it only after all the facts have been verified. However, there are some wholesalers who set their large fancy shape diamonds in custom mountings. Many diamonds shoppers have a hard time visualizing what a diamond will look like in a mounting so the wholesalers try to make it easy for the consumer and hope they fall in love with the mounting.
Advice: The key to buying a diamond already set in a mounting is to be sure it matches the certification and that there are no significant inclusions under the prongs. Putting an inclusion under a prong is fine, just be sure you know what is hidden.
Given the significant difference in cost that can result from a grading error in ring-quality diamonds, it is advisable to buy diamonds with certificates. Unfortunately, the confidence of the public in stones accompanied by certificates has given rise to the practice of altering and counterfeiting them. While you can be relatively sure that “certificated” stones sold by reputable firms are what they claim to be, there are some suppliers and dealers who are seizing opportunities to prey on the unsuspecting. If you have any question regarding information on the certificate, a phone call to the lab giving them the certificate number and date will enable them to verify the information on the certificate
Consumers are approached by telephone solicitors who use high-pressure tactics to sell their gemstones (usually diamonds). They say the diamonds are priced below wholesale prices and their company will always buy the stone back for the selling price. The telemarketing company requires a cashier’s check or certified funds for COD (Cash On Delivery) payment. The courier delivers the diamond and takes the check.
Consumers inevitably end up with diamonds worth a fraction of the purchase price. The gemstones arrive sealed in a protective case saying that if the seal is broken the buy-back policy is voided. If the consumer breaks the seal and has the stones independently appraised, the telemarketing company says the consumer has switched the stones. If the consumer leaves the seal intact, they never are able to validate the quality and value of the stones and will only find out how badly they were scammed years later when they try to sell the stones. These types of scamming telemarketing companies have a way of changing names, phone numbers and mailing addresses on a regular basis so are difficult to track down.
Few consumers profit from investing in gemstones and those certainly did not purchase from a cold call by a telemarketer. If you want to invest in gemstones, you need to work with a professional appraiser and seek out a reputable diamond retailer who has very low overhead and will be in business when you need them.
While the discussion above addresses major fraud topics, there are many minor scams that occur daily in major jewelry chain stores across the country. While these schemes might not make the nightly news, if they happen to you they are real and create a big negative in what should be happy moment in your life.
Below are the common scams and mistakes we hear about from our clients. Hopefully they will increase your awareness and help you make well informed decisions.
Many jewelry stores tag their diamonds set in rings with only the carat total weight (ctw) or total carat weight (tcw), not the weight of the center stone separately. Without the weight of the main diamond, you have no way to compare prices with other rings. In these situations you probably are not buying a certified diamond either so the jeweler has probably exaggerated these characteristics.
Since smaller diamonds have a lower price per carat than larger diamonds, the carat weight of each stone makes a big difference in the value of the ring. For example, if you have a ring with a single high quality diamond weighing 1.00 carat it might have a value of $6,000. If the ring had a 0.5 carat center stone and four smaller side stones, the total carat weight might still be 1.00 but the value might be $3,500. Carrying this example one step further, if the ring had ten high quality diamonds with 1.00 total carat weight, the value could be $2,000.
Knowing what you are buying is always important with diamonds, but is especially true when the diamonds are already set in a ring. Insist on knowing the carat weight of the main diamond in a ring.
Bait-and-Switch is when a jewelry store advertises a diamond at a great price, but when you arrive to buy it, it’s already sold. They usually offer to show you something much more expensive. Although this scam is outlawed by the Federal Trade Commission (FTC), it still is practiced by retailer across the nation.
While there are some legitimate situations where a unique item was sold and is no longer available, in most cases a diamond retailer should be able to find a diamond with similar specifications for very close to the advertised price.
At Diamond Source of Virginia we search the inventories of hundreds of cutters and wholesalers nationwide so are able to find a good selection of diamonds that meet your shopping criteria including the price. If it exists on the wholesale market, we will find it for you.
High intensity lights make every diamond look better. In fact they are sometimes so bright they would make a piece of bottle glass look great. Jewelry stores often use special bulbs that have a strong blue component, which makes yellow diamonds look whiter. Other special bulbs have strong ultraviolet wavelengths so make any diamond with fluorescence which can make stones in the near-colorless range look whiter.
We have many consumers call us and say they bought a diamond ring in a mall store the night before that looked great but it looked different today when they looked at it at home or in the office. When you are shopping for a diamond, insist on seeing the diamond away from the special lighting. Look at the diamond in incandescent lighting, regular office fluorescent lighting and out in the natural sunlight. When we show diamonds in our diamond viewing room which has no special lighting, we even turn the lights off. A diamond with great cut should be bright and have lots of sparkle even with no direct light. If you think about it, where do most people see your diamond? It is in a living room, restaurant, church or office and not under special spot lights.
It is common knowledge that the major diamond trading center in the US is located on 47th Street in New York. Many consumers are under the false impression that because diamonds are traded there, somehow the diamonds in the jewelry stores on the street are going to be a better buy. The cutters and wholesalers are in high security offices high above the street level. The jewelry stores are no more than tourist traps with high pressure sales personnel who are so slick you will not know you are being taken until it is too late.
Use common sense. The overhead for these jewelry stores in New York since it is some of the highest retail rent in the country. Security costs and employee expenses are also high in Manhattan. With high overhead, come prices that are no value. If the price seems low, it simply reflects the low quality they are trying to unload on you.
There has been many a consumer who purchased from jewelry stores on 47th Street only to find the diamond the bought was not as advertised when they had it appraised at home. If you thought the high pressure sale people were slick when you purchased, you can only imagine how slippery they will be if you try to get your money back. If you live outside of New York, keep in mind you will have to pay New York sales tax if you purchase there.
At Diamond Source of Virginia we have many clients who work within walking distance of the Diamond District. There is a reason they purchase from us and that is because diamond shoppers in New York know there are no good deals on the street in the Diamond District.
When people are traveling and on vacation, they often seem to leave their shopping common sense behind. This is especially common when it comes to purchasing jewelry in some small shop in “the Islands.” The cruse ship drops hundreds of shoppers off every day who are flush with cash and short on time. They find a shop with gold jewelry that seems very low priced and then the shop owners mentions they sell diamond rings too.
If the shopper was at home they would research the market online to comparison shop. If they were at home they would take the ring to an independent appraiser for a second opinion before purchasing. If they were home they would sleep on the purchase to see if it was just an impulse buy or something they really wanted and needed. Unfortunately, they are on vacation and only have an hour or so to make up their mind. They are made to feel that if they pass up this “deal of a lifetime” they will always regret it. They got the regret part right, just that the regret is for the impulse buy they make.
We have clients on a regular basis tell us they purchased a diamond in “the Islands” but when they got home the appraiser said it was not what was advertise to them. This should not come as a surprise if the diamond did not have a certification from the AGS or GIA. The cold reality comes when they try to get in touch with the shop owner who was so friendly just a few weeks before. Suddenly the phone calls are not answered and there seems to be no way to get a refund. If they purchased with a credit card, they have some recourse through the credit card company. However, they still have the diamond and the owner will contend the diamond was sold in good faith and was “as advertised.” If they paid with a check, they have almost no recourse since US laws do not apply.
The reality is that just because a diamond is sold in “the Islands” does not mean it will be a better value. The online diamond market in the United States is extremely competitive and usually has lower prices to the consumer than countries where diamonds are mined or cut. Shop with reputable domestic diamond retailers with low overhead and who specialize in diamonds and buy diamonds with certifications from one of the major grading laboratories.
Some jewelry stores insist that if you are going to take a diamond to get another opinion, you must leave a deposit, usually full payment. Of course this only makes sense because the retailer needs some financial protection if you are taking the diamond out of their store.
The problem comes with the refund policy if you return the diamond because it did not get a favorable appraisal. Insist that the deposit be totally refundable. Many stores have a policy that all returns are only for credit towards another diamond. Who wants to buy a second diamond from a retailer who misrepresented the first stone?
Also be sure you get an accurate description in writing of the diamond you are taking. We have heard of situations where the store insisted the diamond that was returned was not the diamond related to the deposit. If you have no written description of the diamond, you could be in for a very uncomfortable situation. Just because you are honest and trustworthy, does not mean all retailers are.
One of the oldest scams in the retail sales game is the practice of giving a big discount from some inflated list price. These “list” prices, “compare at” prices or “manufacturer’s suggested retail” prices are meaningless for diamonds.
The only price that matters for a diamond is what you are paying for the diamond. If the price to you is $5,000, what does it matter if the retailer shows you a tag with $10,000 or $15,000 on it? If a retailer values each and every customer coming through their door, why should they offer some customers better prices than others?
At Diamond Source of Virginia, we give our low price on every diamond, to every client every day. We truly believe that every client deserves the best price and best service, don’t you?
While not as common as it was in past years, there are still some jewelry stores that put a little blue “paint” on the bottom tip of a diamond set in a ring. This is small enough that it is difficult to see but since the light passing through a diamond tends to reflect near that location, it is enough to spread that color throughout the diamond. The result is that diamonds with some natural yellow tint will look whiter than their true color.
As with most tricks like this, the best defense is buying a diamond with a certification from the GIA. Then you will know the color grade you are paying for. If you suspect or are worried that this trick might be used against you, simply have the diamond cleaned in an ultrasonic cleaner that will remove the paint.
Probably the most common of all scams is where jewelry stores provide misinformation about diamond characteristics. Since most stores are trying desperately to sell the diamonds in their display case even if it is not what you are shopping for, they will say whatever they can to make their diamond attractive to you.
Check out our Jewelers Tricks and Traps page for a discussion of the most common misinformation tactics.