A lot of people have contacted me about Chaim’s last memo on the Diamond Dealers Club and “certifigate.” First of all, let me say that, while the allegations in the memo are serious, I cannot independently confirm them, although I am certainly trying to. I can reveal that, apparently, the federal criminal investigation into the GIA “certifigate” scandal, which many had given up on, is still active, if moving pretty slowly. This story isn’t finished yet.
Talking about the DDC, it is amazing how much attention this “term limits” issue has received. But let’s look at the bigger picture. The DDC, like just about every entity in this industry, is still finding its place in the new world. It was designed as a home to middlemen, and middlemen are an endangered species today. Only about 100 of its members regularly use the bourse floor. The Club has introduced an on-line trading platform, which is active and becoming a valuable tool. Many are hoping that the DDC will morph into more of a trade assocation, and take a more active role in industry issues and interacting with government. That is happening, in an under-the-radar way. Yet, other associations have a much higher profile, and some worry about the Club being marginalized if things aren’t turned around.
Obviously, good people have different opinions on “term limits.” Currently, the New York and Israeli clubs are the only bourses that have them. In New York, as the “long-time club member” notes here, they were put on about 20 years ago in response to a President who many felt had abused his position.
This new proposal, which will be voted on by the bourse membership next week, would eliminate term limits for every elected position. Some think that, if they are eliminated, it will turn club president Jacob Banda into a “president for life.” Last week, I spoke to Jacob, who I like and respect. He works hard and has done a great job attending to the needs of a sometimes-demanding membership. He told me has “no position” on the term limit question, and isn’t sure if he wants to run again. I take him at his word. However, I hope the Club realizes how this looks to the outside world. To some, it seems that every time the current President’s term is about to expire, the by-laws are changed so his time in office can be extended. This is not necessarily a fair perception, but that is what is out there. The idea of a “President for life” who eliminates term limits has unfortunate, Third World overtones. And that perception is becoming a problem and distraction for the Club, and that’s not something the bourse can really afford right now.
An organization with stagnant leadership is often perceived as a stagnant organization. It is up to club members next week to decide the best way to move the Club forward.
Chaim’s memo, which was cut off when it was posted on the Idex forum, ends with these lines:
Eliminating leadership term limits will probably spell the beginning of the end of the DDC. The exodus of good and respected members will continue. On the other hand, one also might argue that any diamond bourse that protects (even if not knowingly) some members that represent the scum of the industry may neither have a right nor a reason to remain in business.
Maybe it is better for the diamond industry at large if we just let the DDC’s term limits be abolished – without adding any further comment.
I don’t agree with the negative tone here. The DDC has been an integral part of this industry for over 75 years. It is still a great organization, and an icon of the New York industry. Like Chaim, I have heard from many respected bourse members, some with long-standing ties to the Club, who are talking about resigning if the proposal to eliminate “term limits” goes through. Others have resigned already. I think this is wrong-headed and self-defeating. If you want to change things at the Club, quitting won’t help. Everyone who cares about the instititution should stay involved and make their voices heard.
I will probably have more to say about this at a later date. In the meantime, comments are welcome, but again, keep them civil and respectful of the people involved. (Non-civil comments will be deleted.)
UPDATE: The DDC responds to Chaim’s column.