Rapnet Bans EGL Reports from Trading Network

[John P]

http://www.jckonline.com/2014/09/09/rapnet-bans-egl-reports-from-trading-network?

By Rob Bates

Text of article beging: - - - Trading network RapNet is no longer allowing diamonds to be listed on its services with reports from any branch of European Gemological Laboratory (EGL).

Reports from EGL International—formerly known as EGL Israel—have recently come under fire, with Nashville, Tenn., news station WSMV airing a series of reports criticizing local jeweler Genesis Diamonds for carrying them. That had led to lawsuits targeting the jeweler for carrying those reports.

“The Rapaport Group is opposed to the misrepresentation of diamond quality,” said Martin Rapaport, chairman of the Rapaport Group, in a statement. “The over-grading of diamonds is an unfair practice that destroys consumer confidence and the legitimacy of the diamond industry. Retailers who sell over-graded diamonds using GIA terminology and non-GIA grading standards are at great risk. When consumers try to resell their diamonds or send them to the GIA for regrading and discover significant quality differences, there will be hell to pay.”

The statement adds “we reject the idea that there is no diamond grading standard and caution RapNet members not to use GIA grading terminology to describe diamonds that are below a reasonable tolerance range of the GIA standard.”

Some were surprised by RapNet’s decision to no longer list any EGL reports, including those from EGL USA. When a 2013 Rapaport survey compared grades from labs, EGL USA was said to be “in the same ballpark” as GIA, if softer on color.

Martin Rapaport did not answer JCK’s requests for comment. However, the RapNet statement said, “While some EGL grading reports are more consistent with GIA grading standards than others, there is, in our opinion, confusion and inconsistency among the various EGL grading reports.”

EGL USA and EGL International did not respond to requests for comment from JCK, though both said they would at a later date. In May EGL International issued a statement in response to the criticism from WSMV.

Brian Manookian, the lawyer who has brought lawsuits against Genesis, predicts the announcement will help his case.

“It corroborates our theory,” he says. “If you are going to use GIA terminology, you should use GIA standards. It is nice to have major industry lions come out and confirm what we have been saying out of the gate.” - - - Text ends.

 

[permafrost]

I wonder if Polygon will follow suit.


A jeweler I was looking to use for a setting, tried to pitch me an EGL stone (completely unsolicited). At which point, I lost confidence in him.

 

[Karl_K]

about time.

 

[Circe]

Wonder how this is going to affect the old cut market, as most dealers tend to send their OEC/OMC cut stones to EGL. Is everybody just going to have to recert? Holy unexpected expenses, Batman!

 

[Rockdiamond]

Great point Circe- there's a ton of EGL graded stones beside older ones as well- it would be a big change removing such a large percentage of the entire diamond listings.....
As of right now, there are still EGL graded diamonds showing.
I wonder if it's only for new stones, or if they will remove the existing ones?

 

[Karl_K]

Can they ban igi next please?

 

[kenny]

Good riddance.

I hope there is tons of publicity so the public will avoid EGL graded stones.
Then the retailers will stop stocking them.

Better yet, throw the bums in jail.

 

[SirGuy]

I'm sure this was a decision coming after much due deliberation. I'm intrigued that they included all EGL shops (USA is what I'm referring to) but I can see the point. If most of EGL is a different standard than GIA, can we expect most consumers to know one branch might be better than another? Glad to see the publicity picking up. An educated and informed buyer is a good thing.

 

[Rockdiamond]

I am in total agreement that EGL grading is .....a problem for consumers.
But I think it may be throwing the baby out with the bathwater to remove all EGL graded stones from the list. By cutting off EGL stones you're gong to loose a large percentage of the list itself.
Wholesale buyers should be able to at least look at the EGL graded stones on the market in my opinion.

Again,it's awesome that Rappaport is taking a public stance ...but there may be better methods of making progress on this very important issue.

 

[oldminer]

If EGL and every other lab were required to formulate their own grading of color and clarity and then using nomenclature other than the GIA uses, provide certs graded to their specific standards, none of this would have happened. Mis-using GIA standards is at the heart of the problem. EGL could make a their colors 11, 12, 13, 14. 11 could be GIA D/E, 12 could be GIA F/G, 13 could be GIA H/I, 14 could be J/K. Any sort of system needs a reference to another standard system, but they would not be confused as being identical.

Explaining clearly on the report, on their website and on their printed publications how a non-GIA lab grades compared to GIA, in an open and honest way, would prevent the mis-use of grading reports. That would be utopia and I can't see that being acceptable to those who currently flog bad paper.

Still, there is no harm in buying a diamond with an EGL report so long as you just act like a diamond dealer and re-grade the diamond to GIA standards before buying it. Consumers can't do this easily, but dealers have little problem with EGL reports. Rapaport has really rocked the boat.

 

[Garry H (Cut Nut)]

While I do not approve of over grading - lets think about potential unintended consequences:

Reducing the number of EGL graded diamonds by removing them from B2B platforms will not help B&M consumers being mauled in Malls.
It could make it harder for them to notice the difference - imagine if there were none listed on Pricescope for popular searches - and other websites - many of whom pick up RapNet B2B trade listings. More young guys will get ripped off because the loss of transparency that will occur.

The FTC and other bodies may disapprove - Rap has undue market power and this could be seen as an abuse?

There are genuine cases where buying an EGL graded stone has reuslted in a win - as we showed in our 2004? pricing grading survey.

EGL USA has not been mentioned - they too will be outlawed.

GIA is already a gorilla - does this mean that it will become GodZilla? (who said they already are?)

 

[Modified Brilliant]

When I received my daily e-mail from JCK regarding this topic, honestly I was a bit surprised but not shocked. I agree with Dave Atlas. Why do labs think it is okay to abuse standards that are not THEIR standards? If you are NOT GIA then you need to develop your own grading system and call it the "XYZ" diamond grading system and then list your grading beside the GIA grading for comparison purposes. Let the consumer decide if your system stacks up to the GIA system. Or just use your own system and not mention GIA at all. By doing that, a lab will need to earn respect and recognition on their own merits....not the merits of others. I have had to do the explaining of EGL grading to many appraisal clients over the years. I would say that many appraisers did the same and acted as transparent and honest professionals. The rest of the industry has lagged behind or stuck their heads in the sand. Finally, the time for transparency has arrived and it is long, long overdue.

 

[Texas Leaguer]

I am with those who believe over grading damages consumers, consumer confidence and therefore the entire industry. And I am glad that an entity with clout has taken a stand to try to put a stop to it.

Having said that, I like the concept of a program to bring all labs into compliance with a single standard rather than give the death penalty to a large (and mixed) segment of the lab market. It is good to have competition among the labs. It leads to innovation - for instance if AGS had not pushed the envelop of cut grading, perhaps GIA would never have followed suit.

GIA is overwhelmed with volume and having growing pains. There is plenty of room in the market for ethical players to perform identification and grading services. The consumer market needs dependable identification and quality assurance services delivered in reasonable time frames at reasonable rates.

Perhaps this ban will be a wake up call that will lead to positive change. Seems like it would be possible to develop an annual independent audit that would help ensure reasonable consistency in grading among the lab community.

 

[Garry H (Cut Nut)]

I am with those who believe over grading damages consumers, consumer confidence and therefore the entire industry. And I am glad that an entity with clout has taken a stand to try to put a stop to it.

Having said that, I like the concept of a program to bring all labs into compliance with a single standard rather than give the death penalty to a large (and mixed) segment of the lab market. It is good to have competition among the labs. It leads to innovation - for instance if AGS had not pushed the envelop of cut grading, perhaps GIA would never have followed suit.

GIA is overwhelmed with volume and having growing pains. There is plenty of room in the market for ethical players to perform identification and grading services. The consumer market needs dependable identification and quality assurance services delivered in reasonable time frames at reasonable rates.

Perhaps this ban will be a wake up call that will lead to positive change. Seems like it would be possible to develop an annual independent audit that would help ensure reasonable consistency in grading among the lab community.

We have an audit mechanism Bryan: Some EGL stones from their worst labs were trading at half the price of GIA stones.
Part of the trouble is that the EGL business is an 'insider trading game'.
And some of the better EGL labs (maybe South Africaa and maybe USA) are going to be closed down.
it is also possible that HK and Israel will drop to even lower lows because there will not be an independant audit (i.e. Rap listings) any more.

I do not want anyone to think I like EGL - i am the guy that owns 2 EGL graded stones that I use to show customers why they should not buy one from anywhere else.
And I did the poster based on one of them at the GIA Symposium and had stand up arguement with the owners of the EGL labs at the Symposium. (no one in the trade stood up to the challenge I made at the time) There is a link and article in the Journal here.

 

[denverappraiser]

I’m expecting several results from this:

#1 A name change for EGL-USA and EGL-Canada (owned by EGL-USA). In my opinion they’ve needed to do this for years but this is a perfect opportunity for them to separate from the EGL brand with plausible deniability that it’s Rap’s fault. They have a well-equipped and well-staffed lab that is perfectly suitable for consistent grading if they want. A merger with a well-regarded foreign lab or brand would benefit both. Who? How about HRD, NGCG, or Forevermark?

#2 Competitors of Rapnet, from Polygon to IDEX to completely new entrants are going to be all over this. It’s HALF of the Rapnet database we’re talking about. The dealers aren’t going to just take those stones and pitch them into the ocean. They NEED another channel and new players are going to pick this up opportunity to eat a piece of Rap’s lunch. Manufacturers need this channel. Jewelers demand it. Consumers demand it.

#3 Rap will welcome the new, improved, EGL-USA with open arms. The sooner the better.

#4 GIA’s schedule problem is going to get worse. They’re quoting 10 weeks now. Plus shipping. Even ignoring the problem of what to do with the existing inventory of EGL goods, new production that previously would have been channeled to one of the EGL labs will now need to go somewhere else. Where? The obvious choice is GIA. That 10 weeks is going to grow to 20.

#5 ‘Alternative labs’, like AGS, IGI, HRD and GCAL are going to get buried as well. This is the best opportunity in a decade for someone to crack the hegemony of GIA.

 

[John P]

#2 Competitors of Rapnet, from Polygon to IDEX to completely new entrants are going to be all over this. It’s HALF of the Rapnet database we’re talking about. The dealers aren’t going to just take those stones and pitch them into the ocean. They NEED another channel and new players are going to pick this up opportunity to eat a piece of Rap’s lunch. Manufacturers need this channel. Jewelers demand it. Consumers demand it.

Pursuant to this, it's interesting, and not without gravity, that Polygon has also banned EGL Int'l reports.

CFlutist started a thread on the Polygon ban here.
https://www.pricescope.com/community/threads/polygon-also-bans-egl.206119/

 

[diagem]

I also am one of those who believe there is no room for a marketing system promoting laziness!!
I don't think we really understand the repercussions fully yet. This is some sort of heavy duty quake very deep under our industry grounds. The ripple effect is starting to be felt and soon we'll also know how damaging this really means to the industry.

Fraud or not is the question..., on the table.

Industry players claim they deal with EGL's on heavy discounted numbers between each other (there could be a 100% value spread in some instances between EGL & first tier labs). All players understand the rules of the game.

They might be correct when it comes to inter-dealer transactions, But that doesn't forfeit their responsibilities for potential monetary damages to consumers when purchasing EGL's at the retail level. At least not according to my opinion.
Soon enough we will know more, there are a few lawsuits ongoing on this very issue.

We are witnessing common & despaired behavior from Diamond dealers practicing what they know best, buy cheap - sell cheap! Unfortunately this is a direct symptom reflecting lack of education and knowledge of the direction this industry is moving towards.

Until dealers understand they MUST learn how to add value and not base their marketing on low-value discounts they will continue to look for the lazy way out....

I am extremely surprised IDEXonline decided to welcome EGL graded Diamonds to their database. I have a feeling this will change soon enough.

 

[Modified Brilliant]

I wonder how long it will take before this story reaches consumers across the country and the world. It seems that it is very slow moving and is connected to just a few retailers at this point. But how will this effect the consumer directly once they learn that their EGL graded diamond might not be accurate? Will they return to the seller/retailer and demand an explanation? Will they have any recourse at that point? Who will be held responsible? EGL? The wholesaler who sold EGL reports to the retailer? The retailer who sold to the consumer? It happens all the time...once again the ultimate loser is the consumer. This will get very ugly once thousands and thousands of consumers find out.

 

[Garry H (Cut Nut)]

#2 Competitors of Rapnet, from Polygon to IDEX to completely new entrants are going to be all over this. It’s HALF of the Rapnet database we’re talking about. The dealers aren’t going to just take those stones and pitch them into the ocean. They NEED another channel and new players are going to pick this up opportunity to eat a piece of Rap’s lunch. Manufacturers need this channel. Jewelers demand it. Consumers demand it.

Pursuant to this, it's interesting, and not without gravity, that Polygon has also banned EGL Int'l reports.

CFlutist started a thread on the Polygon ban here.
https://www.pricescope.com/community/threads/polygon-also-bans-egl.206119/

I believe most EGL are traded B2B old fashioned way and sold in B&M's where comparison is harder.
and many have GIA, IGI and HRD certs as well

 

[Rockdiamond]

I think Garry is making a good point- a fair percentage of the people getting hurt are buyers at walk in retail environments- such as jewelry districts the world over.
Most of the major players in online diamond sales don't offer EGL reports.
A notable exception being older stones, where it seems EGL paper is considered more acceptable. That might change.....
One large EGL online marketplace is eBay.
It will be interesting to see if they follow suit in restricting the sale of EGL graded stones..

I wonder how long it will take before this story reaches consumers across the country and the world. It seems that it is very slow moving and is connected to just a few retailers at this point. But how will this effect the consumer directly once they learn that their EGL graded diamond might not be accurate? Will they return to the seller/retailer and demand an explanation? Will they have any recourse at that point? Who will be held responsible? EGL? The wholesaler who sold EGL reports to the retailer? The retailer who sold to the consumer? It happens all the time...once again the ultimate loser is the consumer. This will get very ugly once thousands and thousands of consumers find out.

Great question Jeff- and it highlights the power of the internet.
A story about gem labs on TV, or in the newspaper has an impact for short period of time.
A larger percentage of online shippers are educated- at least to the point of knowing how to google to find complaints and bad stuff. Which as we all know, can last forever online.

It will certainly be interesting to watch the impending litigation- sure to follow.....

 

[John P]

For a significant consumer population this is mind-over-matter.

Let's take some guy (like any of us making a purchase out-of-our-expertise) who wants a certain level of "quality" ... Let us call it 1ct F VS2 EX/Ideal NF

Due to terms of service I can't publish exact pricing, but I can circumvent that and trust that the point will be evident: On Rapnet you'll find EGL USA 1.00 F VS2 Id NFs selling for a low-high of "0-25." Meanwhile GIA 1.00 F VS2 EX NF options are selling for "20-230" (Yes..230!).

Logically, the GIA options around 20 have significant steep-deep cut issues. The GIA options closer to 230 have promising numbers.

But let's get back to "our guy" who wants something that looks good in the spotlights and says 1.00 F VS2 Ideal... He's dealing with some toothy EGL fiend claiming he is a "wholesaler" and pushing the diamonds from 0-25 (with a pretty big markup). Maybe he's dealing with a reputable guy offering GIA options for a conservative markup (on 200-230!). There is no doubt the reputable guys will SEEM expensive compared to the fiend.

For our guy, even paying 25 (the HIGH end of the EGL USA options, even with some big markup added) is far far far more attractive than busting out DOUBLE to climb to a conservatively priced GIA with color, clarity and cut-quality that are all likely to hold their value.

Mind over matter. He buys EGL.

By any gemologist's reckoning he didn't actually get F VS2 Ideal. But on paper he did - and he will never consult a gemologist. The girl melts and cries and wears the ring and THAT is a win in his book. Given the fact that he started this "quest" a few weeks ago he is just relived that it's done. And he won't have anything to do with it ever again.

Rinse. Repeat.

Not on Pricescope - we have a more evolved consumer population here - but in the real world this happens day in and day out.

 

[Modified Brilliant]

I agree with most of what you are saying John, but might add that the REAL problem starts when the melting crying woman shows her stunning EGL International "F" color diamond (which in reality could be an I-J) and her friend Jen has a real GIA graded "F" colored diamond and why does mine appear faint yellow and hers whiter by comparison....and this happens alot of the time. There are so many facets (no pun intended) to this situation that one can only "speculate" what happens next. It is taking GM a decade to deal with their consumer issues.

 

[Lookinghard]

I almost don't feel bad for the consumer that knowingly purchases an EGL graded stone. Although color and clarify is literally set in stone, how they are represented is not. A consumer should know that a EGL graded diamond won't be graded in the same way as a GIA or AGS graded diamond. That's why EGL diamonds are usually cheaper. The consumer is under no compulsion to buy, but if they see the diamond and meets their expectations for what they want their diamond to look like at a price they like, it doesn't really matter which lab graded it.

However if the consumer is mindful of what's on the lab report, the onus is on them to educate themselves on how much faith to place on various reports. If a car buyer doesn't know that a 200hp Kia is not equivalent to a 200hp BMW, then a diamond buyer who thinks EGL grades are equivalent to GIA is just as ignorant. Not everyone is a savvy consumer and many of them live just fine.

 

[Garry H (Cut Nut)]

I almost don't feel bad for the consumer that knowingly purchases an EGL graded stone. Although color and clarify is literally set in stone, how they are represented is not. A consumer should know that a EGL graded diamond won't be graded in the same way as a GIA or AGS graded diamond. That's why EGL diamonds are usually cheaper. The consumer is under no compulsion to buy, but if they see the diamond and meets their expectations for what they want their diamond to look like at a price they like, it doesn't really matter which lab graded it.

However if the consumer is mindful of what's on the lab report, the onus is on them to educate themselves on how much faith to place on various reports. If a car buyer doesn't know that a 200hp Kia is not equivalent to a 200hp BMW, then a diamond buyer who thinks EGL grades are equivalent to GIA is just as ignorant. Not everyone is a savvy consumer and many of them live just fine.

sad fact - most buyers are not smart to our cheating systems and they get ripped off.
Most buyers may not be educated web savvy researchers.
most buyers are in the Kia ford range and not Beemer buyers

 

[TC1987]

^ singing...

...Rome, Georgia
Athens, Texas
and Paris, Tennessee

No we're not the jet set
We're the old Chev-ro-let set...

I drive Fords and Chevys. Rode in a Porshe 911 once, just once. Whenever I run into someone who is looking at engagement rings, I tell them to go look at Pricescope first. But there are many people who'd apparently rather just get the purchase over with and get ripped off than bother to get an education.

 

[OoohShiny]

^ singing...

...Rome, Georgia
Athens, Texas
and Paris, Tennessee

No we're not the jet set
We're the old Chev-ro-let set...

I drive Fords and Chevys. Rode in a Porshe 911 once, just once. Whenever I run into someone who is looking at engagement rings, I tell them to go look at Pricescope first. But there are many people who'd apparently rather just get the purchase over with and get ripped off than bother to get an education.

Sad but true...

I'm not convinced anyone trusts people who aren't very close friends when they are looking at a $$$$ purchase - why not trust the guy in the shop, after all, he sells them all day every day...

I gave some advice by email to a girl at work who was looking to buy - just basic stuff, look for GIA etc - she didn't even come back to me and I'm not sure she paid a blind bit of attention... Looks like she's ended up with a c.1ct rock that is not that sparkly and looks like it's a bit too deep...



Oh, and I almost forgot - I smiled to myself as I walked past a local jewellers today because in the last week or so a large "We sell GIA" cardboard stand thing has appeared in the window next to the rings section... They do also sell IGI, but they're not shouting about that...

 

[Texas Leaguer]

I almost don't feel bad for the consumer that knowingly purchases an EGL graded stone. Although color and clarify is literally set in stone, how they are represented is not. A consumer should know that a EGL graded diamond won't be graded in the same way as a GIA or AGS graded diamond. That's why EGL diamonds are usually cheaper. The consumer is under no compulsion to buy, but if they see the diamond and meets their expectations for what they want their diamond to look like at a price they like, it doesn't really matter which lab graded it.

However if the consumer is mindful of what's on the lab report, the onus is on them to educate themselves on how much faith to place on various reports. If a car buyer doesn't know that a 200hp Kia is not equivalent to a 200hp BMW, then a diamond buyer who thinks EGL grades are equivalent to GIA is just as ignorant. Not everyone is a savvy consumer and many of them live just fine.

sad fact - most buyers are not smart to our cheating systems and they get ripped off.
Most buyers may not be educated web savvy researchers.
most buyers are in the Kia ford range and not Beemer buyers

The consumer is smart enough, they just don't realize the onus is on them to verify the labels. When you shop for other products you look at the specs and it says 100 calories or 100% cotton or 200hp you don't feel it imperative to independently verify these things.

The problem is that the industry has allowed, and to an extent is complicit in allowing abuse of the GIA standard. It's not that some are selling Kia 200hp and others BMW 200 hp- it's that some are selling BMW bodies with Kia engines and putting the onus on the customer to discover the deception.

The fact that many labs do maintain reasonable compliance with the GIA standard proves that what is needed is not fewer labs, but a better system of industry self-regulation such that all labs apply the same standards consistently. Or, as others have suggested, create their own standard with transparency and let the consumer decide if they prefer to rely on that seperate standard.

 

[denverappraiser]

deleted. I'll make a new thread

 

[blingbuyer]

For a significant consumer population this is mind-over-matter.

Let's take some guy (like any of us making a purchase out-of-our-expertise) who wants a certain level of "quality" ... Let us call it 1ct F VS2 EX/Ideal NF

Due to terms of service I can't publish exact pricing, but I can circumvent that and trust that the point will be evident: On Rapnet you'll find EGL USA 1.00 F VS2 Id NFs selling for a low-high of "0-25." Meanwhile GIA 1.00 F VS2 EX NF options are selling for "20-230" (Yes..230!).

Logically, the GIA options around 20 have significant steep-deep cut issues. The GIA options closer to 230 have promising numbers.

But let's get back to "our guy" who wants something that looks good in the spotlights and says 1.00 F VS2 Ideal... He's dealing with some toothy EGL fiend claiming he is a "wholesaler" and pushing the diamonds from 0-25 (with a pretty big markup). Maybe he's dealing with a reputable guy offering GIA options for a conservative markup (on 200-230!). There is no doubt the reputable guys will SEEM expensive compared to the fiend.

For our guy, even paying 25 (the HIGH end of the EGL USA options, even with some big markup added) is far far far more attractive than busting out DOUBLE to climb to a conservatively priced GIA with color, clarity and cut-quality that are all likely to hold their value.

Mind over matter. He buys EGL.

By any gemologist's reckoning he didn't actually get F VS2 Ideal. But on paper he did - and he will never consult a gemologist. The girl melts and cries and wears the ring and THAT is a win in his book. Given the fact that he started this "quest" a few weeks ago he is just relived that it's done. And he won't have anything to do with it ever again.

Rinse. Repeat.

Not on Pricescope - we have a more evolved consumer population here - but in the real world this happens day in and day out.

you described my best friends experience. And mine last week prior to finding this forum! Luckily, i took the EGL cert and started doing research.

 

[cflutist]

From National Jeweler newsfeed today:

RapNet’s EGL decision ignites flurry of reactions

By Michelle Graff

September 18, 2014

New York--It’s an issue that has been a topic of discussion in the industry for years but seems to have reached a boiling-over point, heated by the string of lawsuits filed against a Tennessee jeweler over EGL International reports and, more recently, a decision by Rapaport.

RapNet, the diamond trading network operated by Rapaport Group, announced last week that effective Oct. 1, diamonds with grading reports from all European Gemological Laboratories, including EGL USA, will no longer be listed on RapNet.

The move resulted in reactions from a couple of labs with the initials EGL.

While a number of labs share the acronym EGL, they actually are not all the same, a fact which the Rapaport Group acknowledged in making its decision, stating, “While some EGL grading reports are more consistent with GIA grading standards than others, there is, in our opinion, confusion and inconsistency among the various EGL grading reports; RapNet has therefore decided not to list any EGL grading reports on RapNet.”

EGL International, the lab most commonly accused of over-grading, is headquartered in Israel. Managing Partner and CEO Guy D. Benhamou said in a statement issued Thursday that there is no international “standard” for diamond grading and that all grading is subjective, a statement the lab has made previously.

“In general, gemological laboratories that issue diamond grading reports will consistently state that the results of diamond grading are, to a certain extent subjective,” Benhamou said.

The statement did not directly address trade allegations of over-grading but went on to state that “EGL International’s laboratory staff is composed of graduate gemologists with international recognition. They work with state-of-the-art technology, enabling them to detect and disclose synthetic (laboratory-grown) diamonds, as well as a variety of advanced treatments to enhance color or clarity (e.g., HPHT).”

EGL USA has its headquarters in New York, a lab in Los Angeles and affiliate labs in Toronto and Vancouver, British Columbia.

In a statement issued Tuesday, EGL USA pointed out that it is “in no way affiliated” with any EGL-named laboratories outside of North America, and in 2003 sued the EGL labs outside of North America for trademark infringement and false advertising. That case is still pending.

EGL USA said it was not accurate of Rapaport to associate it with allegations of over-grading and misrepresentation of diamond quality.

“Simply put, the delisting of EGL USA penalizes us for our name alone. And while that is a great disservice to EGL USA, it is an even great disservice to our customers and the industry-at-large,” EGL USA said, adding that it would announce updated trading platform plans “shortly.”

Alan Lowe, managing director of EGL South Africa, said his lab, which is based in Johannesburg and has an office in Cape Town as well, shouldn’t be “grouped with some of the other EGL laboratories around the world when it comes to ethics or grading policy.”

“The company operates independently from any other EGL laboratory globally and grades diamonds according to acceptable international grading standards,” he said.

RapNet’s decision to stop listing all EGL-graded diamonds also sparked reactions from competing trading platforms.

Polygon announced that effective Wednesday morning, it no longer would list diamonds from any EGL International lab but would continue carrying those diamonds with reports from EGL USA.

Polygon’s Senior Director of Sales and Operations Lindsay Watkin said the decision to swiftly stop listing EGL International-graded diamonds came in reaction to concerns in the trade about discrepancies between EGL International-graded diamonds and those graded by the Gemological Institute of America. “Our job is to support and reflect what’s going on in the industry,” she said, adding that reaction from customers has been overwhelmingly positive.

GemFind and IDEX, however, said they will continue to list all EGL stones, including EGL International.

A story posted Monday by IDEX Online stated that as long as there is no legal restriction, the diamond trading platform, which is on NationalJeweler.com, will continue to list all EGL-certified diamonds.

Newport Beach, Calif.-based GemFind said, “GemFind has chosen to remain unbiased and allow all companies to compete within the GemFind network and leave the decision of what to buy--or sell-- up to the jewelry retailers and diamond suppliers.”