In July, Dateline NBC tackled the subject of inflated diamond appraisals, warning viewers that buyers who rely on retail appraisals “may be in for a rude awakening.”
The show went to several stores and bought diamonds. At all, clerks pointed to appraisals as evidence we were getting a bargain,” reporter Victoria Corderi noted.
At one point, the show paid $999 for a stone with an appraisal of $1,200. At a Zales, the show paid $4,000 for a ring that the retailer-provided appraisal valued at more than $5,000. At Wal-Mart, producers bought a ring with an appraised value of $3,300 for under $2,000.
“Repeatedly we paid substantially less than the appraised value,” Corderi noted. “In almost every case, we were told we got a great deal. It appeared we had saved thousands.”
The show then removed the stones from their settings and sent them to grading labs. Corderi noted, “Some of the grades varied significantly from lab to lab.”
“Consumers believe the grades are chiseled in stones, when in fact there is a high degree of subjectivity,” noted Dateline‘s expert Cap Beesley, who has appeared as a guest expert on the show before.
Corderi said that some of the stones received different grades when they were resubmitted to the labs. She noted that the industry does have accepted grading tolerances, and most of the differences were within that tolerance. But one diamond, described as “perfect” at a Zales, came back with a VS1 clarity.
Another Dateline expert, Don Palmieri, said: “It’s one of the more shameful things in our industry. Appraisals are used as marketing tools. … You get a high appraisal, you walk out thinking you just got the last great deal … [when] you just got misinformed.”
The show warned viewers: “Any appraisal that costs substantially more than the sale price could end up costing you money”—because of higher insurance premiums.
The show also visited International Gemmological Institute, which the show said “gave consistently higher [appraisals] than other labs—sometimes by thousands of dollars.”
IGI president Jerry Ehrenwald said reports “should be read in their entirety, so a consumer is not dependent on the salesperson. A salesperson can say anything they want.”
The last word was left to Palmieri: A “stone is worth what the merchant sold it for. If it was worth more, the merchant wouldn’t sell it for the price they’re selling it for.”
Many were relieved that the story—as well as another Dateline piece that detailed links between al Qaeda and conflict diamonds—aired in the summer, when viewing levels are down. Still, many considered the piece embarrassing.
Zale, IGI, and Wal-Mart did not return calls from JCK. At press time, a transcript of the Dateline segment was available at www.msnbc.msn.com/ id/8661995/.