UpFront

Good News on the Crime Front

It’s too soon to declare victory, but the jewelry industry appears to be on a strong winning streak against crime. Robberies of jewelry stores plummeted 42% through the first 10 months of 1998 compared with figures for the same period in 1997 (158 vs. 274), and even losses by salespersons are down.

The sharp decline in robberies, says JSA president John Kennedy, is too big to be a statistical aberration or simply part of an overall decline in crimes. Instead, he says, it shows the impact in recent years of more aggressive enforcement by police, the FBI, and other agencies against professional gangs and individual crooks.

Supporting that optimistic view, he says, are “a couple of interesting phenomena.” JSA now has trouble getting “Wanted” bulletins on jewelry crooks because the criminals are “being caught more quickly, after two or three robberies instead of 20 or 30, the way it used to be.” The leaders of one group of thieves that robbed several Bailey Banks & Biddle, Helzberg, and Ben Bridge stores in the West, for example, were arrested and indicted earlier this year. Also, Kennedy says, convicted robbers are getting tougher sentences of up to 40 years.

The increased enforcement has been largely spurred by JSA, Jewelers’ Mutual Insurance Co., the industry’s Anti-Crime Task Force (an ad hoc coalition of major jewelry trade organizations and magazines), and some concerned individuals and companies in the jewelry industry. JSA, for example, holds seminars and conferences to inform police of activities and methods of known jewelry thieves.

JSA also reports a small drop in losses by traveling salespeople resulting from theft (208 incidents in the first 10 months of 1998 vs. 222 in the same period in 1997) and a slight decline in fatalities during robberies (13 vs. 14). The annual rate of fatalities has been steadily falling all decade. (It was 38 in 1990.) “More people in jewelry stores are listening to us and are less inclined to reach for a gun or not cooperate” during robberies, notes Kennedy. – William George Shuster

Reward in Ford Heist Triggers Squabble

What might otherwise seem like good news – the recovery of $10.5 million in stolen jewelry and the arrest of the alleged culprits – instead has touched off an ugly legal battle over the reward offered in the case.

Kathleen Ford, widow of automobile magnate Henry Ford II, announced the $1 million reward on the Palm Beach (Fla.) Police Department’s Web site in January 1997 after the jewelry was stolen from her home. That posting, the first instance in which the Internet was used to solve a jewelry crime (JCK, July 1998, p. 140), caught the attention of Atlanta jewelry dealer Jeff Meyer in December of that year. The jewelry looked similar to pieces recently purchased by his friends, Atlanta-area jewelers Randy Jones and Shawn Slep, from a dealer named Barry Marshall.

The Atlanta jewelers immediately contacted law-enforcement agents, and detectives soon linked Marshall to Alvaro Valdez, a suspect in some 100 home burglaries in which $25 million worth of jewelry was stolen.

Ford’s reward and the tip from the Atlanta jewelers proved crucial to cracking the case, says Palm Beach detective Jim Dean. “The case has been a chain of dominoes, and [the Atlanta jewelers] knocked down the first one,” he says. “But there are other people along the way who have helped, too.”

That’s one reason Ford has yet to grant the reward, which the Atlanta jewelers claim is rightfully theirs. Last October they sued Ford for the reward, plus interest. But it turns out they have competition, as two others have come forward, anonymously, with claims to the same reward. These competing claims “look valid,” says Ford’s attorney Frank Chopin.

Another reason for delaying the reward payout, says Chopin, is that the investigation continues. The most significant hold-up, he says, is that there’s still no burglary conviction directly connected to Ford’s losses. Valdez has been convicted solely on federal charges of transporting stolen goods (including Ford’s jewels) across state lines. Last month, Valdez was arraigned on state charges for racketeering, grand theft, and burglary. But police say there isn’t yet sufficient evidence to charge Valdez for the Ford burglary (although it was included among the grand theft charges). Jewelry dealer Marshall, who allegedly acted as a fence for Valdez, also faces federal and state charges.

The Atlanta tipsters, meanwhile, are growing increasingly impatient. “They’ve had knowledge of our role for 11 months now,” says Jones. “The individuals responsible for the crime have been arrested, convicted, and imprisoned, and now we expect our reward.”

Chopin denies that Ford has improperly withheld the reward. The jewelers’ lawsuit, he says, is “an attempt to force her to pay for something to which they are not now entitled. There’s nothing sinister going on here, no attempt to deprive anybody of anything.”

The case has attracted attention in the Atlanta and Palm Beach newspapers, as well as NBC’s “Dateline,” which taped coverage for a report. The Palm Beach Daily News published an editorial in early ’98 asking that Ford make good on the reward. “To avoid or unduly delay paying anyone who has met the terms of the reward offer would be wrong,” the editors opined, “and it would destroy the credibility of future reward offers.”

Chopin bristles at the media coverage, which he feels was meant merely to embarrass his client. “[Mrs. Ford] made the decision that she had the means and would use them in an effort to stop these burglaries,” he says. “When the case is resolved, we’ll deal with the question of a reward, and we won’t deal with it sooner because of newspaper articles that set out to embarrass her.”

Even Chopin concedes that the Atlanta jewelers may yet obtain the reward. “If they’re entitled, they’ll be paid,” says Chopin. In light of the circumstances, however, “they probably won’t be invited to dinner.” – Jessica Stein Diamond

New Firm Picks Up ARMS USA Program

ARMS USA, a new company, has taken over all software support and management services for jewelers who use the Gemological Institute of America’s Advanced Retail Management Systems (ARMS). The new firm will add more products and expand service in 1999.

Don Grieg and Malcom Alderton, who founded ARMS Global Ltd. in Australia in 1992, lead the new company. It will be based in Henderson, Nev., near Las Vegas, with a staff of 20 in retail management and technical support. They will be recruited from ARMS’s main office in Australia and from the American jewelry and computer trades. Alderton and Grieg aim to double their North American jewelry client base within two years and will add music stores, as they have in Australia.

In 1993, GIA – then looking for a business management training program for jewelers – became ARMS’s North American distributor and set up GIA ARMS. Today, 200 independent jewelers (with 300 stores) in North America are ARMS users, out of 800 worldwide. Last fall, GIA said it was ending the program (JCK, December 1998, p. 18). – William George Shuster

JVC Creates ‘Buyers’ Bill of Rights’

The Jewelers Vigilance Committee has developed a “Buyers’ Bill of Rights,” a list of questions that buyers of jewelry at trade shows and elsewhere should ask to ensure that their transactions comply with applicable laws and regulations.

The document consists of five questions pertaining to precious metals and five questions pertaining to gemstones. The questions are based on the Federal Trade Commission Guides for the Jewelry Industry, the National Gold and Silver Stamping Act, United States Customs laws, and other regulations and codes applicable to the jewelry industry.

Trade-show sponsors will send the “Bill of Rights” to all buyers registered to attend; in addition, JVC will make it available to members and will distribute it at its booth at trade fairs.

“This document, in and of itself, is a tool to educate both parties to these transactions,” says Cecilia Gardner, JVC’s executive director and general counsel. “This is not a list of required information; it’s just a suggested list of questions you should ask when you’re involved in a transaction.”

The “Buyers’ Bill of Rights” will be the subject of a seminar at the 1999 JCK International Jewelry Show in Orlando, Fla., on Monday, Feb. 8, 9:15 to 10 a.m., in Room 107 at the Orange County Convention Center. Gardner, along with other representatives of the industry task force responsible for development of the document, will provide information. The “Buyers’ Bill of Rights” also will be distributed at the session.

The “Buyers’ Bill of Rights” consists of the following questions:

Precious metals:

  1. Are all goods within the tolerances of gold, platinum, or silver content as provided in the FTC guidelines?

  2. Are goods stamped with the quality of the metal precious content (i.e., 10k, 14k, 18k, etc.)?

  3. Are all quality marked goods also stamped with a trademark?

  4. Can you provide a copy of your trademark(s) and the current U.S. Patent and Trademark Office registration/certification number for each?

  5. Are all imported finished precious metal items labeled with country of origin?

  6. Gemstones: Do you disclose in writing all treatments (including laser drilling) to diamonds and other gemstones in compliance with the FTC guidelines and the AGTA Gemstone Enhancement Manual?

  7. Are weight tolerances for carat in compliance with the FTC guidelines? Do you disclose in writing diamond weight to the second decimal place?

  8. Do you sell synthetic or imitation stones, and are they labeled as such?

  9. Are your imported stones labeled with country of origin?

  10. What is the nature of the written disclosures and disclaimers on sales invoices and laboratory/grading reports?

For more information, contact JVC at its new address: 25 W. 45th St., New York, NY 10036; (212) 997-2002, fax (212) 997-9148. – Barbara Spector

Stullers Help Create University Endowment

Matthew Stuller, founder and chairman of Stuller Settings Inc., and his wife, CeCe, have helped create a $1 million endowed chair in metallurgy (the science and technology of metals) at the University of Southern Louisiana (USL). Stuller Settings, in Lafayette, La., is one of the country’s largest findings and finished jewelry manufacturers. It also has operations in Tennessee, Thailand, and Israel.

The $1 million Stuller Family Eminent Scholar Chair in Metallurgy in USL’s engineering department was created from a $600,000 gift from the Stullers that was matched by $400,000 from the Louisiana Board of Regents Support Fund.

Stuller, a former USL student who dropped out to run his business, said he hoped the gift would enable the school to become a recognized leader in the study of metallurgy. He and his wife wanted to “do something personally for a wonderful university,” he says, adding that “I wanted to set the example for other businesses.”

Stuller is a cochairman of USL’s year-old “Investing in Our Future Centennial” fund-raising campaign. He and the other two cochairmen launched the campaign in 1997 by jointly creating a $1 million endowed chair in mathematics. By November 1998, the campaign had raised enough for 15 endowed chairs of $1 million each, 50 new endowed professorships of $100,000 each, and $3 million in additional scholarships. – William George Shuster

Gold Consumption Drops From ’97 Level

Gold consumption in the first nine months of 1998 sank 20% in 25 key world markets, says the World Gold Council (WGC). However, that drop from the 1997 level “shouldn’t mask a steady improvement [as] the year progressed,” according to the WGC report, “Gold Demand Trends.”

At the end of the first quarter, when the worst impact of the Asian economic and currency crisis was felt, gold consumption ran 46% behind the1997 level. After the first half of the year, it was down 29%, and by the end of the third quarter it was just 1% behind figures for the same period in 1997. (In developed countries only, such as the United States and Japan, overall demand was actually 16% ahead of figures for the third quarter in 1997.)

The good third-quarter results, says WGC, were due to a “a steady performance by jewelry and a surge in investment,” especially in the United States, where the sale of gold coins rose to near-record levels.

“The growth in investment demand has become more apparent over the past several quarters, and the revival has spread to countries as diverse as Indonesia, Saudi Arabia, Vietnam, the USA, and Japan,” says George Milling-Stanley, manager of gold market analysis for WGC. With the gift-giving occasions in 1998’s fourth quarter, the “outlook is for recovery to continue over the remainder of the year,” he notes.