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Need advice on buying from Africa rough diamond seller...

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diamond_lover

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Hi, I'm new to buying any gemstones, so here we go. I wanted to get all of your opinions on what I plan on doing before I do it (incase the guy's a crook or what he's selling is illegal).
I found a rough diamond seller from Ghana selling rough diamonds for great prices. They would have good clarity and colors which would be specified by Ghana gemologist institute. He says his business is legit, and that since I dont have a gem business and just wnat the diamonds for personal jewelry, I would not need a license of any kind to buy diamonds from him in Ghana. He says the rules are that I must have him process all the necessary documents in order for him to export me any diamonds.
And with each of my diamonds I would be buying from him, 8% would be charged on top of the diamond price for the legal documents and government taxes. He says the 8% is for the kimberley certificate for 2%, VAT (Valued Added Tax) for 2%, Certificate of Origin for 1% and Insurance Certificate 3%.
He says once the gems reach me in my home country, they would not be charged any taxes, is that also true?

Is his diamond selling business legal there, or here in my country (Canada), and he says he's only a independent miner of diamonds, and that he dosent belong to any western association.

I just wanted to know if this is completly legal to buy rough diamonds from him on his end (Ghana), or if I am going to be taxes big time or fined by people here in Canada for buying them??
 

Richard Sherwood

Ideal_Rock
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I don't get it.

Why in the world would you go through all that hassle and risk when you can just buy finished goods here in the U.S. at some of the best market levels available in the world with no downside?

Are you planning on becoming a dealer? If so, as a person "new to buying gemstones" I would not recommend starting out this way.

I know of someone who did something similar in one of those godforsaken African countries, I forget which one.

He flew all the way from the U.S. with cash, and then rode for miles over godforsaken roads to meet up with the sellers in the middle of nowhere.

They robbed him, laughing the whole time about how cooperative the guy was to come all the way from the United States to be robbed.

Why don't you just go to New York City or Miami, walking around downtown looking like a rube, and get robbed? At least then the money will stay in the country.
 

MissAva

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You are too funny Mr Richard! Seriously thought I don’t see why you would go outside of the country and take all those risks? You wont be saving any money when you factor in weight loss, cost of cutting, cost of travel, import taxes, grading report and all that good stuff.
 

Paul-Antwerp

Ideal_Rock
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Here are your chances:

If you are extremely lucky, you will receive rough diamonds of a rather low quality, that cannot be cut into the size-clarity-colour that you paid for.

If you are very lucky, you will receive some kind of rough crystal, that is not diamonds.

If you are just plain lucky, you will just loose your money without receiving anything.

And with a bit of bad luck, you will receive rough diamonds of a very high quality, that you can turn into polished diaminds, while saving you about 20% on the total cost. A week after that, you can repeat the experience, and you will be able to find a cutter, outside of Canada, who wants to pay you 20% profit, just on the rough. So, you start importing rough into Canada, and exporting it outside of Canada, now with a Canadian Kimberley Process-certificate. After a year, you have made a nice profit, possibly even millions of dollars. And then, you are charged with money-laundering and terrorist-funding, and I just hope that you are not traveling outside of your own country at that point in time.

Live long,
 

diamond_lover

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Apr 2, 2006
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Thanks for your guys replies.
Richard, the seller stated that I would never have to travel to Ghana to purchase the rough diamonds as I would only be buying small amounts, and it is never necessary to go there (which is good), so the possibility of me going to Ghana to get robbed is out of the quetsion already.

Paul-Antwerp, I would only be purchasing the rough diamonds from him to be cut, polished, and put in a jewelry setting here in Canada for my personal jewelry collection, never resale. With what I mentioned in my 1st post about the 8% fee's I would be paying, would that make these diamonds legal for export from Ghana? And when rough diamonds are imported into Canada, are they ever subject to any fee's/taxes ever?
I also dont understand how me buying rough diamonds would count as money-laundering and terrorist-funding (since they would not be sold again after I bought them). And he says Ghana does not have conflict diamonds, and that his certificates I would be getting on each diamond would proove that.

I want to make sure everything I'm doing is legal. The guy has great prices on rough diamonds, like $150 for a 1 carat.
 

MissAva

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Date: 4/3/2006 11:50:36 AM
Author: diamond_lover
Thanks for your guys replies.
Richard, the seller stated that I would never have to travel to Ghana to purchase the rough diamonds as I would only be buying small amounts, and it is never necessary to go there (which is good), so the possibility of me going to Ghana to get robbed is out of the quetsion already.

Paul-Antwerp, I would only be purchasing the rough diamonds from him to be cut, polished, and put in a jewelry setting here in Canada for my personal jewelry collection, never resale. With what I mentioned in my 1st post about the 8% fee''s I would be paying, would that make these diamonds legal for export from Ghana? And when rough diamonds are imported into Canada, are they ever subject to any fee''s/taxes ever?
I also dont understand how me buying rough diamonds would count as money-laundering and terrorist-funding (since they would not be sold again after I bought them). And he says Ghana does not have conflict diamonds, and that his certificates I would be getting on each diamond would proove that.

I want to make sure everything I''m doing is legal. The guy has great prices on rough diamonds, like $150 for a 1 carat.
A ct of rough does not equal a 1ct cut stone...and also there are the issues of color and clarity and the cost of having the stones cut....that does not seem too good to me.
 

indecisive

Brilliant_Rock
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I highly doubt he can prove that they are non-conflict diamonds
38.gif
Not worth the risk if you ask me.
 

diamond_lover

Rough_Rock
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Could you guys suggest any questions for me to ask him as for how he can confirm to me in paper that these diamonds are not conflict diamonds?

I should have mentioned earlier that when I say a 1 carat rough diamond, I mean like a 1.26 rough (that would be turned into a 1 carat).

You guys are helping alot. Keep the posts coming :)
(And I fully do not intend to buy anything from him untill I know what I am doing is 100% legal on both sides, Canada & Ghana).
 

pinkflamingo

Brilliant_Rock
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... even if he swears to you on his mother''s life that the stones he sells to you are non-conflict, how are you going to know the difference? Better yet, do you have any recourse if he does not send quality stones? Probably not!

If you are only risking $150, that is not very much money. I wouldn''t pay him more than that.

This kind of reminds me of the email scams "your long lost relative wants to give away 10M. please send X amount to this man in Mozambique and we will send you your money right away."

How did you hear about this guy anyway?
 

diamond_lover

Rough_Rock
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Apr 2, 2006
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I found him in business listings. I found him, he didnt find me.

Those emails where your long lost relatives from Africia want to send you like 50million are soooooooo funny. Their like, I want you to foward me your bank account information.

I think IF everything turns out to be legal, I will go ahead and buy the 1.26 (1 carat) rough from him, just to see how if he''s legit, and thats only AFTER I get the all clear from you guys at some point if you guys think what I''m doing is legal (as far as just buying rough''s from him for my personal jewelry collection).
 

pinkflamingo

Brilliant_Rock
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DIAMOND

Characteristics Of Ghana Diamonds
The characteristic feature of diamonds of Ghana is their small size. They are mainly industrial but a moderate proportion of about 10 - 15% of them are gems cuttable and polishable for use in jewellery production. Gem diamonds of sizes 1 carat and above are few and may not be available in commercial quantities. The average size of Ghana diamonds is about 10 stones per carat.


linky



If he really has many of these very rare larger diamonds, why is getting rid of them so cheap to a small buyer? Doesn''t make sense...
 

MissAva

Ideal_Rock
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I would ask a cutter but I dont think a 1.26 will always get you a 1ct. Please be careful 150$ is still 150$ and it is silly to throw it away.
 

diamond_lover

Rough_Rock
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Apr 2, 2006
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I saw that webpage a few weeks ago and emailed it to him when I was wondering if I would need a license to buy only a few diamonds for my personal jewelry use.

So is what he doing legal with the 8% fee I listed above??? Is there any fee''s I would pay to Canada (on my end of the purchase)? Nobody''s saying anything.
 

princessv

Brilliant_Rock
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Oct 6, 2005
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1,232
I think that''s because buying diamond rough is not something that is usual around here.

IF it''s legal and you end up purchasing...have you thought about who will cut and polish the diamond for you?
 

pinkflamingo

Brilliant_Rock
Joined
Mar 25, 2004
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507
I don''t think anyone here has experience with buying rough from sellers in Ghana. Maybe I''m wrong.

Have you looked on ebay? Here

At least you could pay with a credit card and it is legal.
(I am not endorsing ebay, just an option)
 

Paul-Antwerp

Ideal_Rock
Trade
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To start, there is no gemologist Institute, which will give you a certificate on a rough diamond. However, to buy some kind of paper like this in Ghana probably should not be too expensive. That piece of paper therefore is useless.

Like I said in my post, if you are very lucky, you will only be defrauded for the amount of money that you pay.

If you have back luck, you will indeed receive a cuttable rough diamond of 1.26 Cts. Let us assume that it is high quality rough, which means that this stone will give you 2 nice brilliants of 0.25 Cts. each. Oh, I forgot, first, you have to find someone who can saw these diamonds in Canada. Too bad, only some big cutting companies also do sawing, and they are not going to disturb their operation for one stone with a different origin.

The fact is: you do not know the basics of diamond-cutting, and you think that you can outsmart the whole industry. Be my guest, if I cannot stop you, I will not try again.

My remark of money-laundering and terrorist-financing is much more serious and has nothing to do with conflict-diamonds or non-conflict. If you buy rough diamonds to be cut, it is presumed that you know what you are doing. In that case, it is your duty to know whom you are selling from, and that these sales are legit. If you did not take all necessary precautions to find out whether your supplier is a legitimate businessman, buying his stones in a respectable manner, you are responsible if these stones come from illegal sources, or if your money is used to finance terrorists.

Live long,
 

pricescope

Ideal_Rock
Joined
Dec 31, 1999
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8,266
Unfortunately, stories about rough diamonds from Africa are often connected with the con schemes.

We don''t want to make any speculations in this particular case but suggest to stay away from such topics on this board and seek serious legal and professional advice on the trade sites such as Rapnet.com or Idexonline.com
 
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