Synthetic diamonds, IGI finds the first real threat

[Garry H (Cut Nut)]

http://www.diamonds.net/news/NewsItem.aspx?tc_dailyemail=1&ArticleID=40156

This raises the fear that the integrity of natural diamonds can be threatened by hard to detect fakes.
The article does not mention the size of the stones - which I expect is small - but the fact that the stones were hard to sell indicates experienced traders smelled a rat.

I will not post any quotes because interested people should read the entire short article.

For those going to JCK in Vegas, there is going to be a great coverage on this topic from Linares (Apollo) Jim Shigley and Tom Chatam.
http://accreditedgemologists.org/2012LasVegas/index.php

 

[John P]

From the intra-laboratory alert:

• Mostly F to J Color, Clarity VVS – VS. Internal characteristics were feathers, pinpoints, small dark crystals. The inclusions are strikingly similar to natural inclusions, hence, microscopic observation is insufficient to conclude.
• Sizes ranged from 0.30 ct to 0.70 ct.
• Polish, Symmetry and Cut were either “Excellent” or “Very Good”.
• Bruted or faceted girdles.
• They were all type IIa and were referred as such by DiamondSure.
• When tested using DiamondPlus all the synthetics gave a “refer CVD” result.
• When viewed in DiamondView they showed bluish green fluorescence and blue phosphorescence, with characteristic striations.
• The synthetics showed moderately strong photoluminescence from H3 and nitrogen-vacancy optical centres (zero-phonon lines
at 503 nm and 575/637 nm respectively).
• They also exhibited photoluminescence at 737 nm that is attributed to silicon-vacancy centres.
• Absence of any laser inscription.

 

[ame]

This is just freaky. So diamond testers don't pick it up, labs can't really tell entirely...will this open the door to labs grading at a higher magnification than present to look for any other characteristics not consistent with a natural mined diamond?

 

[Gypsy]

John can you explain those results. I understand what some of it means. But not all of it.

 

[Christina...]

John can you explain those results. I understand what some of it means. But not all of it.

me either.

 

[John P]

This is just freaky. So diamond testers don't pick it up, labs can't really tell entirely...will this open the door to labs grading at a higher magnification than present to look for any other characteristics not consistent with a natural mined diamond?

Not in this case, where the inclusions were apparently introduced into the synthetic production for the sole purpose of making these diamonds appear natural. Per the above, microscopic examination would not have been sufficient. But the primary labs have photoluminescence instruments which reveal stones grown in labs according to a method called CVD (chemical vapor deposition).

The fact that this level of synthesis exists is not surprising. Technology grows exponentially (Kurzweil - The Singularity Is Near). But the fact that high-placed professionals would violate mandatory disclosure practices and "spoof" natural inclusions in a blatant attempt to move synthetics into natural channels is somewhat surprising to me. The blow-back could be massive.

 

[Christina...]

This is just freaky. So diamond testers don't pick it up, labs can't really tell entirely...will this open the door to labs grading at a higher magnification than present to look for any other characteristics not consistent with a natural mined diamond?

Not in this case, where the inclusions were apparently introduced into the synthetic production for the sole purpose of making these diamonds appear natural. Per the above, microscopic examination would not have been sufficient. But the primary labs have photoluminescence instruments which reveal stones grown in labs according to a method called CVD (chemical vapor deposition).

The fact that this level of synthesis exists is not surprising. Technology grows exponentially (Kurzweil - The Singularity Is Near). But the fact that high-placed professionals would violate mandatory disclosure practices and "spoof" natural inclusions in a blatant attempt to move synthetics into natural channels is somewhat surprising to me. The blow-back could be massive.

“This means that there could be a large amount of undisclosed synthetic diamonds on the ‎market.”‎

Does this statement include graded diamonds? I assume that if a dealer is unable to the difference that appraisers also would be unable to? If this is the case, what should a consumer who recently purchased a diamond and is concerned that it may be synthetic do? Would resubmitting it for testing be the only option?

EDIT And do labs use photoluminesense (sp) technology on all submitted diamonds to determine it's origin?

 

[Garry H (Cut Nut)]

Thanks John,
Before everyone panics - Diamond View picks these stones up for further testing.

So labs will have a role, and seeking out the sources should not be that hard via backwards paper trails.
The trade has faced synthetic issues for 120 years.
If they become pervasive then simple type II testers will be made at low cost if all us diamond dealers and vendors need them.

 

[John P]

Thanks John,
Before everyone panics - Diamond View picks these stones up for further testing.

So labs will have a role, and seeking out the sources should not be that hard via backwards paper trails.
The trade has faced synthetic issues for 120 years.
If they become pervasive then simple type II testers will be made at low cost if all us diamond dealers and vendors need them.

Correct.

Most surprising to me, as I mentioned above, is that some high placed entity or entities would risk themselves this way. It's kind of like stone-swapping on a macro level. The major industry players I know are saying "Are you kidding me?? Not worth it!"

Gypsy and Christina: Normally lab-grown diamonds are sold with full disclosure as well as laser-inscription proclaiming man-made origin. In this case there was no disclosure, no inscription, inclusions were introduced to mimic nature and the lab-growns were mixed in with natural diamonds. But despite all of that they were instantly identified by IGI-Antwerp and reported to the leadership of the diamond industry... So the bright side is that a highly advanced and organized deceptive effort was stopped in its tracks.

 

[kenny]

Thanks John,
Before everyone panics - Diamond View picks these stones up for further testing.

So labs will have a role, and seeking out the sources should not be that hard via backwards paper trails.
The trade has faced synthetic issues for 120 years.
If they become pervasive then simple type II testers will be made at low cost if all us diamond dealers and vendors need them.

Correct.

Most surprising to me, as I mentioned above, is that some high placed entity or entities would risk themselves this way. It's kind of like stone-swapping on a macro level. The major industry players I know are saying "Are you kidding me?? Not worth it!"

Gypsy and Christina: Normally lab-grown diamonds are sold with full disclosure as well as laser-inscription proclaiming man-made origin. In this case there was no disclosure, no inscription, inclusions were introduced to mimic nature and the lab-growns were mixed in with natural diamonds. But despite all of that they were instantly identified by IGI-Antwerp and reported to the leadership of the diamond industry... So the bright side is that a highly advanced and organized deceptive effort was stopped in its tracks.

So, no fakes have slipped through to retailers or the buying public?

 

[Garry H (Cut Nut)]

Thanks John,
Before everyone panics - Diamond View picks these stones up for further testing.

So labs will have a role, and seeking out the sources should not be that hard via backwards paper trails.
The trade has faced synthetic issues for 120 years.
If they become pervasive then simple type II testers will be made at low cost if all us diamond dealers and vendors need them.

Correct.

Most surprising to me, as I mentioned above, is that some high placed entity or entities would risk themselves this way. It's kind of like stone-swapping on a macro level. The major industry players I know are saying "Are you kidding me?? Not worth it!"

Gypsy and Christina: Normally lab-grown diamonds are sold with full disclosure as well as laser-inscription proclaiming man-made origin. In this case there was no disclosure, no inscription, inclusions were introduced to mimic nature and the lab-growns were mixed in with natural diamonds. But despite all of that they were instantly identified by IGI-Antwerp and reported to the leadership of the diamond industry... So the bright side is that a highly advanced and organized deceptive effort was stopped in its tracks.

I am awaiting confirmation, but I believe these were all small stones - too small to have had grading reports. The cost of certification could be higher than the cost of the stones.
But the fact that someone was suspicious enough to submit them - knowing they would face a financial loss - that is what is interesting.

But please folks - do not panic - the point is that the industry is abuzz with this as of the last couple of days and the source will be tracked down as everyone knows who they bought goods from.
No one will deal with fakers - it is not worth it.

 

[TitanCi]

Wow, so what does it mean for the manufacturers of these diamonds that are not disclosing their synthetic origin??? Any legal ramifications?

 

[Gypsy]

Okay. That's good. So... buy diamonds with reputable lab reports.

Mine is a GIA stone from 2004 without an inscription. If I were to ever get it re-certed should I ask for an inscription then?

 

[John P]

So, no fakes have slipped through to retailers or the buying public?

I can't say yes or no, Kenny, any more than I can tell you nobody has been sold CZ, SM, YAG, etc. as if it were a diamond. For that matter, what about natural diamonds that are sold with hugely inflated color or clarity grades? Fraud happens, and not just in the jewelry biz.

There are mandatory policies and industry practices, established from the outset, which the few producers of MMDs have appeared to follow rigorously until now. While this is an important alert, I take comfort in the fact that such sophisticated fraud was efficiently identified and exposed. Kudos to IGI-Antwerp and other vigilant labs.

Wow, so what does it mean for the manufacturers of these diamonds that are not disclosing their synthetic origin??? Any legal ramifications?

Yes, and there are also industry implications. Frankly there are few MMD producers capable of CVD synthesis at this level. The one responsible for creating these synthetics is going to come under heavy fire from many quarters. Possibly unrecoverable fire. Then you likely have a natural diamond seller who was involved. That entity could feel the heaviest blows. Within the industry the WFDB and relevant local bourses will come under pressure to suspend or expel the offending company from every bourse in the world, crippling or ending their ability to stay in business.

As for legal consequences: The buyer who purchased these as natural diamonds can file criminal complaints. FWIW such transactions in the USA are more than just FTC violations. Misrepresentation in this sector is flagged for money-laundering scrutiny, which falls under the purview of Homeland Security and the US Justice department. Belgium (where this was caught) has its own, stricter, AML regulations and consequences.

Furthermore, let's remember that these MMDs were imported into Antwerp as natural diamonds. Woops... That means fraudulent documentation was provided to the governmental diamond office. They are the only way to import diamonds to Antwerp...did I mention their processes are stricter than in the USA? The D.O. can choose to confiscate the goods, or wait for the lab or the buyer (most likely since he now knows his goods are "no good") to submit them as evidence. Another interesting aspect is that the buyer who purchased the diamonds received 60 days credit terms on the parcel... He hasn't paid for them. Woops2.

Okay. That's good. So... buy diamonds with reputable lab reports.

Exactly, and on Pricescope this is compulsory advice. So this forum is already helping - as it relates to this, inflated grading and cuts that go woof - in terms of prevention/protection on an individual consumer level.

 

[Karl_K]

Interesting and not surprising.
I think most everyone in the trade was expecting this to happen eventually(I know I was) which is why the buyers were cautious and the lab ready to catch them.
Which is a good thing.

 

[TitanCi]

So, no fakes have slipped through to retailers or the buying public?

I can't say yes or no, Kenny, any more than I can tell you nobody has been sold CZ, SM, YAG, etc. as if it were a diamond. For that matter, what about natural diamonds that are sold with hugely inflated color or clarity grades? Fraud happens, and not just in the jewelry biz.

There are mandatory policies and industry practices, established from the outset, which the few producers of MMDs have appeared to follow rigorously until now. While this is an important alert, I take comfort in the fact that such sophisticated fraud was efficiently identified and exposed. Kudos to IGI-Antwerp and other vigilant labs.

Wow, so what does it mean for the manufacturers of these diamonds that are not disclosing their synthetic origin??? Any legal ramifications?

Yes, and there are also industry implications. Frankly there are few MMD producers capable of CVD synthesis at this level. The one responsible for creating these synthetics is going to come under heavy fire from many quarters. Possibly unrecoverable fire. Then you likely have a natural diamond seller who was involved. That entity could feel the heaviest blows. Within the industry the WFDB and relevant local bourses will come under pressure to suspend or expel the offending company from every bourse in the world, crippling or ending their ability to stay in business.

As for legal consequences: The buyer who purchased these as natural diamonds can file criminal complaints. FWIW such transactions in the USA are more than just FTC violations. Misrepresentation in this sector is flagged for money-laundering scrutiny, which falls under the purview of Homeland Security and the US Justice department. Belgium (where this was caught) has its own, stricter, AML regulations and consequences.

Furthermore, let's remember that these MMDs were imported into Antwerp as natural diamonds. Woops... That means fraudulent documentation was provided to the governmental diamond office. They are the only way to import diamonds to Antwerp...did I mention their processes are stricter than in the USA? The D.O. can choose to confiscate the goods, or wait for the lab or the buyer (most likely since he now knows his goods are "no good") to submit them as evidence. Another interesting aspect is that the buyer who purchased the diamonds received 60 days credit terms on the parcel... He hasn't paid for them. Woops2.

Okay. That's good. So... buy diamonds with reputable lab reports.

Exactly, and on Pricescope this is compulsory advice. So this forum is already helping - as it relates to this, inflated grading and cuts that go woof - in terms of prevention/protection on an individual consumer level.

Thanks, John. Why would anyone take that risk? The risk:reward ratio seems slim, especially in a field that I would think is heavily scrutinized! Geez...

 

[Gypsy]

Thanks John!

 

[denverappraiser]

The escalation between the fraudsters and the gemologist has been going on since literally the beginning of the gem business. They make a fake, gemmos find a way to detect it, consumers rely on the gemologist to make a decision, the bad guys find a way to undermine the test or find a different fake, the gemologists come up with a new test or a new tool, and the process repeats itself. It’s a huge problem for the trade but the exposure for the public isn’t nearly as bad as you would think. What’s unique about this case is the deliberate introduction of microscopic inclusions in order to make them look more natural with that test and the deliberate attempt to sneak them through a lab. This was not an accident or some sort of mis-filing. Making diamonds is pretty hard. There are rather few people on the planet who COULD make these things and they don’t live in a vaccuum. Scrutiny is going to be considerable and whoever made them is going to have some ‘splaining to do if they want to keep their customers.

If you follow even reasonably sound shopping procedures as a consumer you are well protected through anti fraud laws.

1) Buy from a dealer you are otherwise inclined to find trustworthy.
2) Insist that the seller put the details in writing and include specifically about synthetic/natural origin.
3) Rely on grading by labs that you consider to be credible. If you don’t know or don’t trust the lab, don’t do the deal. The major labs including GIA, AGS, IGI, EGL, EGL-USA and HRD and others are well prepared to detect these things. Not all will issue a grading report on a synthetic but those that do are very obviously and clearly identifying them as such.
4) Buy in countries with sensible consumer protection laws.

 

[Karl_K]

Gemesis: It's Not Us, Others Sold Inappropriately

http://www.idexonline.com/portal_FullNews.asp?id=36810

 

[Christina...]

Gemesis: It's Not Us, Others Sold Inappropriately

http://www.idexonline.com/portal_FullNews.asp?id=36810

Karl is it possible to acquire stones for Gemesis and then add the inclusions to the stones, or is that something that would have had to been done in the creation process? It seems as though polishing off the inscription would have been simple enough.

And how exactly did the offender think that these CVD's would slip through when labs appear to be diligently testing for them?

 

[Karl_K]

Karl is it possible to acquire stones for Gemesis and then add the inclusions to the stones, or is that something that would have had to been done in the creation process? It seems as though polishing off the inscription would have been simple enough.

And how exactly did the offender think that these CVD's would slip through when labs appear to be diligently testing for them?

I think they would have to be done in the creation process.
Many diamonds are sold to consumers that never make it to a major lab.
These might have never been sent to lab if the owners hadn't had trouble finding a buyer.

 

[Karl_K]

CVD equipment is not that uncommon.
It's is a fairly small step from doing DLC and other industrial coatings to making diamonds.
It is even a smaller step from creating diamonds and derivatives for semi-conductor use and making gem grade diamonds. It may even be a step backwards. ie: the semi-conductors are harder.
There is a ton of money being poured into the semi-conductor use of diamond and diamond like material and several hundred companies involved from giants like Intel/Samsung/IBM/GE and several large Chinese firms to 2-3 people start ups. GE has been involved in creating diamonds for decades.
I would not be surprised to someone involved with the semi-conductor sector being the brains behind the creation of these either directly or indirectly.

 

[TitanCi]

it's already rare to have FL/IF natural stones, so is it even rarer to produce stones that do not have any inclusions at all? I feel **if** you can control the environment, then it should be easier to produce a FL/IF MMD and to limit the metallic inclusions normally found in them. But I guess that isn't the case, so is that why these producers felt the need to introduce more natural like inclusions???

 

[Karl_K]

it's already rare to have FL/IF natural stones, so is it even rarer to produce stones that do not have any inclusions at all? I feel **if** you can control the environment, then it should be easier to produce a FL/IF MMD and to limit the metallic inclusions normally found in them. But I guess that isn't the case, so is that why these producers felt the need to introduce more natural like inclusions???

metallic inclusions is usually in hpht created diamonds.
CVD it is usually carbon and feathers.
IF and somewhat vvs stones are always given a harder look than others so they are more likely to be caught, the best way to get by with it would be in the vs range.
SI the inclusions because larger and easier to identify and say hey that don't look right.
VS is about right for someone to look at it say yep looks right and move on to the next without taking a deeper look.

 

[Garry H (Cut Nut)]

Gemesis: It's Not Us, Others Sold Inappropriately

http://www.idexonline.com/portal_FullNews.asp?id=36810

There is an article in Tacy (Chaim Even-Zohar) where he has identified that Gemesis is under new ownership (reputable Indian diamond Co) and moved HPHT to Malaysia / Penang and CVD to Singapore. USA Florida is just a core R&D group now.

It seems there may have been cash flow issues and there is a possibility that some rough was sold = isolated parcel turns up.

CVD set ups do seem to be expensive when the need is to grow a thick layer.
However lower purity is less valuable to hi tech semi conductor industry and maybe they get flogged off for gems?

 

[TitanCi]

it's already rare to have FL/IF natural stones, so is it even rarer to produce stones that do not have any inclusions at all? I feel **if** you can control the environment, then it should be easier to produce a FL/IF MMD and to limit the metallic inclusions normally found in them. But I guess that isn't the case, so is that why these producers felt the need to introduce more natural like inclusions???

metallic inclusions is usually in hpht created diamonds.
CVD it is usually carbon and feathers.
IF and somewhat vvs stones are always given a harder look than others so they are more likely to be caught, the best way to get by with it would be in the vs range.
SI the inclusions because larger and easier to identify and say hey that don't look right.
VS is about right for someone to look at it say yep looks right and move on to the next without taking a deeper look.

ahhh I see. Thanks for the bit o' info!

 

[Karl_K]

This is not looking good at all:
http://www.idexonline.com/portal_FullEditorial.asp

"Many undisclosed lab-made diamonds are smaller goods, the kind not usually graded. That means that buyers won't ever know that mixed into the parcels are undisclosed lab-made diamonds.


Such goods are set into jewelry as side stones or in a pave setting. Several folks on the technical side of the industry suspect that some of the smaller yellow diamonds set in jewelry are undisclosed lab-made diamonds.


Even-Zohar goes further and names Su-Raj Diamond & Jewelry in New York City as the company that sold the goods at their natural diamonds value without disclosing their lab origin. Even-Zohar reported that the Gemesis fulfillment center in New York is housed in the very same offices as Su-Raj NY and quotes Gemesis CEO Stephen Lux as stating that the center is located in premises owned by Su-Raj NY.
The family of Jatin R. Mehta, Chairman of Su-Raj Diamond & Jewelry reportedly holds a 50.01 percent stake in Gemesis USA. "

 

[canuk-gal]

HI:

Good time to cut IGI some slack?!

cheers--Sharon

 

[Garry H (Cut Nut)]

On a Linked in discussion my friend Branko mentioned a simple method for identifying CVD (and HPHT) small diamonds in parcels that would never go to labs because of size/volume/cost.

It turns out that because CVD diamonds are grown on flat bases of an existing diamond, layer upon layer, that they tend to have vertical columns of stress which, as all diamond gemologists know, stress in singly refractive gems can be seen between crossed polarizing filters. e.g. if you broke a pair of polaroid sun glasses in half, placed the diamond on one lens and turned the other lens at 90 degrees and looked with a loupe or microscope you will see the strain.

Polariscope is one of the least expensive and most common gem tools that is in the 101 lesson - https://www.google.com/search?tbm=i...0.0.1.1.0.116.1020.1j9.10.0...0.0.DBdsS97LTGg

So thanks to our wonderful scientificly trained Gemologists, there is no reason fakers can get away with cheating.

Acknowledgement: Branko Deljanin (Canadian Gemological Lab, Vancouver ) and Dusan Simic (Analytical Gemology and Jewelery, New York).

 

[Jim Summa]

This is from Canadian Jeweler...

Update on synthetic diamonds delivered to IGI

A few weeks ago, it was reported that more than 600 synthetic diamonds were delivered to the International Gemological Institute (IGI) laboratories in Antwerp and Mumbai. De Beers wrote in a statement that the diamonds were “strikingly similar” to those produced by a Florida company named Gemesis. Journalist Chaim Even-Zohar found “the trail of invoices covering the trail of the undisclosed synthetic diamonds leads to the source—Su-Raj Diamonds and Jewelry USA in New York.” The company is owned in part by Jatin Mehta, a majority shareholder in Gemesis. Company chief executive officer, Stephen Lux, stated that Gemesis and associated companies “are taking an audit of all inventories, transactions, and procedures.” Gemesis has removed its operations from New York, where it once shared a building with Su-Raj.