Guide to buying a diamond

There are many traps for the unwary, such as bogus sales, "blood diamonds", and overpricing.
 
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  • Updated:26 May 2008
 

01.All that glitters

diamond ring

CHOICE’s investigation has uncovered traps for consumers when purchasing expensive jewellery.

On average, Australian couples spend around $5000 on an engagement ring. But it’s nearly impossible for an ordinary person to judge the real value of a diamond. For example, hard-to-detect artificial treatments and small variations make a huge difference to its value.

  • The ACCC uncovers many bogus 'sales'. For example, in February this year the Federal Court held that discount advertising from Prouds Jewellery Pty Ltd was misleading, and therefore in breach of the Trade Practices Act. A gold bracelet advertised as "Was $249, Now $99" had never been offered for $249 by Prouds.
  • Traders sometimes try to pass off fake goods as genuine material. For example, the SA Office of Consumer and Business Affairs caught a trader who claimed to sell high-quality gold jewellery from a shopping centre stall. In fact, the jewellery was gold-plated with a total gold content of less than 1%.

For advice on how to make sure your jewellery is covered if it gets stolen, see our report on Insuring jewellery.

Did someone die for your diamond?

The 2006 movie Blood Diamond highlighted the role diamonds have played in human rights abuses and wars. So-called 'conflict diamonds' were sold to help fund wars in Sierra Leone, Angola and the Democratic Republic of Congo, which killed an estimated 3.7 million people. Today, conflict diamonds from rebel-held areas in Cote d’Ivoire are thought to still find their way to the international diamond market.

In 2002, an international certification scheme called the Kimberly Process was launched to end the trade in conflict diamonds. Australia participates in this scheme. Ask your jeweller for details and a copy of their company’s policy on conflict diamonds — any jeweller worth their salt can guarantee their diamonds are conflict-free.

Fair trade diamonds

Exploitation in the precious stone industry is also rife — for example, labourers in Sierra Leone can be paid only around US$1 per day. Development of fair trade standards has begun — it’s high time profits from diamonds filtered down to workers in countries they’ve helped devastate.

Please note: this information was current as of May 2008 but is still a useful guide to today's market.


 
 

 

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