Top 20 Diamond Scams

The 20 most common scams in stores
and 13 precautions to avoid them.

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What Is The Single Most Important Thing To Know In My Diamond Search?

“If I only had 15 minutes to learn about diamonds, what is the one thing I need to know most of all?”

After much thought, I would have to say the most important factor in finding the best price on a quality diamond is finding the best dealer. I have several reasons for this answer.

  1. Obviously, only the most efficient dealers will be able to stay in business offering low markups on find goods. And there are no “deals” in this business. If one diamond price is lower than another diamond at one of the top internet dealers, you can be sure that something about the quality is lacking. No exceptions. To get a good deal, you need to find a good dealer.
  2. Only the most honest dealers will represent the quality of a diamond accurately. Without proper grading and assessment of a stone’s beauty, you will usually pay more for a lesser quality diamond. The practice of over-grading is still so common that I cannot warn you enough about it. That is why we insist that you should receive a respected, third-party grading certificate with any diamond.
  3. Only the most knowledgeable dealers can help you make all the best decisions about the 4 Cs and beyond, to help you find a diamond that fits all of your personal needs.

How to Find the Best Diamond Dealers

We offer two ways to help you find the best diamond dealers:

  1. For the best prices anywhere, you should read our independent, expert ratings of the top dealers on the internet. Many have been in business as local stores for years before adding a Web site and offer much more than just good prices. We can save you days of research and give you confidence with our test results. In these reports, we compare prices, diamond selection, search engines, information given, customer service, etc.
  2. Check out our complete tutorial on choosing a good dealer. Also, read our lesson on avoiding the 20 common scams to make it safe. Many jewelers, both local and on the internet, use unsavory tricks of the trade to increase markups. Most offer lower quality goods and will not show certificates because grading is exaggerated. The two articles above will help you buy with confidence.

Should A Jeweler Show Me The Certificate?

“I was at a jeweler, and they said they don’t show certificates because it only confuses people. Shouldn’t they show me the cert so I know it’s for real?”

I can think of no reason for a dealer to hesitate showing you a Cert / Certificate from a nationally respected, independent gemological laboratory like GIA, AGS, or EGL…. UNLESS the diamond is not graded accurately. And that is still very common even in “fine” stores across the country. Most diamonds without certs are overgraded by at least one color or clarity grade… and perhaps both. This can mean you would spend as much as $1,000 extra for quality that is not there in a 1-carat diamond. Every tiny grade means a lot of money, even though a layperson could never see the difference.

This is why you should always insist on seeing a certificate from one of these labs before buying any diamond.

Can You Help Me Find The Best Diamond Store?

“Can you help me find the best diamond store?”

I am so glad you asked that question, because we have spent a lot of time, money, and energy researching the top dealers on the Web as well as local jewelers to find the best.

These reports tell you which companies have the best prices, selection, customer service, return policies, information provided, accuracy of knowledge, and search engines.

To maintain objectivity, we don’t sell diamonds. Diamond dealers cannot influence the content of these reports.

If you want to know more, go here to learn How I Make Money.

If you have any suggestions for additional Web sites to review, please e-mail the URL so we can add them to our list for future research. Each site takes us many days but we will have it done as soon as possible.

Aren’t All Diamond Grading Labs The Same?

“Are all the gem labs the same? Aren’t all certs the same? They all say what color and clarity and proportions, so why are GIA diamonds so much more expensive than EGL?”

Definitely not. Most smaller gem labs are extensions of local jewelry stores, created solely for the purpose of raising the image of the store’s inventory. But such labs are hardly unbiased and the certificates are rarely accurate.Even the large labs vary a lot in their reliability, definitions of terms and grades, and in their consistency and conservatism.

To make it simple, if you want an honest assessment of a diamond’s true quality, avoid any lab that is not one of those listed below:

GIA — Gemological Institute of America

The most widely respected laboratory in the world today. Certs from this lab are in such demand that diamonds with a GIA cert are often priced 30-50% higher. This premium is also due to the fact that the diamond is truly the stated quality, since GIA is known for its conservative grading. All labs can make a mistake, but GIA labs have been the most consistent for decades.

AGS — American Gemological Society

This was the only large, nationally respected lab that assigns a grade to the overall cut of a diamond. Now they all give cut grades, using varying criteria for each grade. More on that in my future blog, or the upcoming new website. Certs from AGS are often used for all Ideal Cuts, and describe all the details of the cut to verify perfect proportions. If you want a perfect cut above anything else, you should insist on an AGS cert.

EGL-USA — European Gemological Laboratories

Several related labs around the world operate under this network. Please focus on certs from the EGL-USA network of labs if you want to include EGL certs in your search. EGL certs from other labs around the world are NOT as reliable yet. The grades at the non-USA labs are not as reliable, and that reflects on the value of the diamond. EGL-USA labs are consistent in our opinion.

AGL — American Gemological Laboratory

This lab is best known for its work in the colored stone industry, working to provide expert assessments of gemstone identification, treatments, and enhancements. The diamond certs have recently gained a reputation as more consistent and conservative, but not popular or well known yet.

Note About Other Labs

Other labs may be highly qualified and offer excellent information. However, other labs do not enjoy the same reputation and popularity as those listed above, and therefore will not command as much value if you ever need to sell the diamond. In the worst scenario — and a very common one — other labs will not grade the diamond properly and you are not receiving the actual quality of diamond you want. In most cases, you will end up paying too much for a diamond of lesser quality with certificates from other labs.

How Do I Know What Price To Sell My Diamond?

“I have a diamond ring that I ‘need’ to sell. I have the EGL
certificate, original receipt, insurance cert and RAP as of June 2014
which is $19,000.”

This involves a little mini-lesson in diamond pricing and an overview of the market. I know it sounds oversimplified, but… The only way to sell a diamond is to find a buyer. The only way to know the price is to see what they offer.

The best price you can get, is the best price someone offers. There is no law that says a store has to pay a certain price, so… the offers you get are based on how much that store wants that particular size and quality of diamond.

With the advent of efficient online ordering and overnight shipping from suppliers a decade ago, everything shifted. Nowadays, stores do not really need to stock diamonds. Most sales are done by calling a supplier to order what a customer wants. Stores don’t rely on their own inventory much these days, because it is so expensive to buy diamonds and keep them in stock for months or years. They can just have something sent in. So… the only diamonds they want to buy now, are the really good deals, like when a customer comes in and they can offer a low amount, as you noticed.

So to get the best price, go to more stores, and take the highest offer. Get them all in writing, and go back to the best one. 

Who Are The Best Buyers Of Large Diamonds?

“My wife is looking to sell an 8.20 carat, round, I colour, vvs1
diamond, GIA certificate. It is currently set in a ring.
I wonder if you have any experience with buyers ?”

The best buyers of anything are the ones that have shown integrity over the years. I have not tested the companies that buy diamonds from consumers yet. I have been focusing on testing stores that sell diamonds instead. But I know some of the stores that buy and sell large goods, called specials in the trade.

One I know in Houston, and one in L.A., and one in Atlanta. I can pass your message along and see which is most interested. They might not want to buy, but they will have connections or can broker the transaction, and they are people I trust with my life. Do you have a preference among those locations, if they are all interested?

-Robert Graves