Colleagues and friends,
The diamond industry is facing a serious challenge to its integrity which could lead to major consumer confidence problems, if diamonds are sold with overstated certification. I want to stress that this is an industry problem that must be resolved by the industry in order to retain consumer confidence in our product and sustain and develop the international diamond trade.
Recently, awareness was raised regarding problems existing within a specific laboratory group and the overstating of grading from certain laboratories in this group, which has led to the exclusion of said laboratories certificates by the Rapaport Group.
Your attention is drawn to the following issues:
(a) Ethical grading and certification are the most basic principles of the industry and these cannot be compromised.
(b) As part of the sales transaction the seller of diamonds provides a guarantee to the buyer of what is being sold and this forms a binding contract between the two parties. The seller cannot later hide behind an overstated grading report claiming ignorance as he/she will be held responsible regardless of any grading report supplied with the diamond(s) being sold. Diamantaires cannot hide behind certificates with the excuse that these goods sell cheaper. There is a common standard of colours and purities, and it is not about price but quality.
(c) In blatant cases the misrepresentation can amount to fraud with criminal consequences, depending on a countries consumer laws.
(d) Member Bourses must implement action in countries experiencing this kind of practice:
(i) If the offending party is a member, then the bourse concerned should take action under its own rules.
(ii) If the offending party is not a member, then the bourse concerned should report it to that countries consumer rights regulator in order to protect consumers rights..
On behalf of the Board and with regard to this issue, I commit the WFDB to ensure that we resolve matters as quickly as possible. We cannot reserve our position whilst this kind of practice prevails from a few laboratories that are damaging the entire diamond industry. Decisive and immediate action is required to eliminate this practice and the WFDB is in terms of its mandate compelled to take the lead. To this end a meeting will shortly be called of all the major laboratories to find common ground on the way forward.
I call on all responsible stakeholders across the world to stand together to eliminate this practice as it will harm our industry in a way that could dwarf any previous problems faced by the diamond industry.
I look forward to your full and ongoing support in this matter.