What is an ''independent'' appraiser?

[denverappraiser]

An appraiser is anyone who has an opinion of value and who presents themselves as an expert. This leaves quit a bit of room for charlatans and frauds and this topic gets discussed quite a bit here but there seems to be an increasing confusion over appraisers who describe themselves as ‘independent’. What is this, and when is it necessary?

Different appraisers use this word very differently and there’s quite a bit of grey area near the borders. To be eligible for the appraisers list under the resources tab at the top of the page the appraiser must first be marketing their services as an appraiser and secondly they must not be selling diamonds or jewelry through that business. As with the above, this leaves lots of room for interpretation. I would love to hear from folks on what they consider to be the ethical boundaries for an ‘independent’ appraiser.

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Can they sometimes be independent and sometimes not or must it be an either/or type question? Can some services count as independent and some not?

Can they share office space with someone in the buying and/or selling business? Can they have an office inside a jewelry store or some other jewelry related business? Can they have a mobile business where the work is done in a variety of different jewelry stores and where the stores get a portion of the fee?

Can they refer business to buyers or sellers when requested to do so by the client?

Can they have investments in other sorts of jewelry businesses, especially retail jewelry stores but possibly other business that buy, sell, manufacture and repair as well? Can their employees?

Can they broker or otherwise assist clients with resale issues where they collect a commission or fee on the deal assuming they provide full disclosure?

Can they work with jewelers or other dealers to resell their services and pay the jeweler a commission for this?

Can they have a second job working somewhere else? Can their employees?

Can they pay referral fees to dealers?

Can they prepare work for stores in advance so that the store can provide an appraisal report as part of a sales presentation?

Any other boundaries?

Neil Beaty
GG(GIA) ICGA(AGS) NAJA
Professional Appraisals in Denver

 

[oldminer]

Super questions bound to make some of those listed squirm a bit.

We have heard relatively little bad news about any of the appraisers on the Pricescope list, but that does not mean a few should have their situations reviewed. I think there are times when a truly independent appraiser might feel an exception to a rule or two is justified and that might be okay. If you are in the hands of a caring person who is sincerely attempting to help direct you without benefit to them, the situation remains pretty comfortable. Conflicts of interest are to be avoided.

 

[strmrdr]

Date: 2/18/2008 8:21:26 AM
Author:denverappraiser
An appraiser is anyone who has an opinion of value and who presents themselves as an expert. This leaves quit a bit of room for charlatans and frauds and this topic gets discussed quite a bit here but there seems to be an increasing confusion over appraisers who describe themselves as ‘independent’. What is this, and when is it necessary?

Different appraisers use this word very differently and there’s quite a bit of grey area near the borders. To be eligible for the appraisers list under the resources tab at the top of the page the appraiser must first be marketing their services as an appraiser and secondly they must not be selling diamonds or jewelry through that business. As with the above, this leaves lots of room for interpretation. I would love to hear from folks on what they consider to be the ethical boundaries for an ‘independent’ appraiser.

----------------------------------------------------------------------------

Can they sometimes be independent and sometimes not or must it be an either/or type question? Can some services count as independent and some not?

Id prefer independent in all ways. Yes some services can count as independent and some not but its a slippery slope.


Can they share office space with someone in the buying and/or selling business? NO
Can they have an office inside a jewelry store or some other jewelry related business? NO
Can they have a mobile business where the work is done in a variety of different jewelry stores and where the stores get a portion of the fee? NO, but would consider an exception as long as the goods were not new purchases made at that store.

Can they refer business to buyers or sellers when requested to do so by the client?
NO, its too slippery of a slope, recomending a benchman for repairs or keeping a list of those that are known too do good work would be ok as long as no money changes hands.

Can they have investments in other sorts of jewelry businesses, especially retail jewelry stores but possibly other business that buy, sell, manufacture and repair as well? Can their employees?
stock, 401k and stuff yes directly no

Can they broker or otherwise assist clients with resale issues where they collect a commission or fee on the deal assuming they provide full disclosure? NO!!!!!

Can they work with jewelers or other dealers to resell their services and pay the jeweler a commission for this? NO!!!! with the exception of the mobile lab above.

Can they have a second job working somewhere else? Can their employees?
yes but not for anyone who's diamonds they may appraise.

Can they pay referral fees to dealers? NO!!!!

Can they prepare work for stores in advance so that the store can provide an appraisal report as part of a sales presentation? As long as its labeled as a diamond report and not an appraisal and has no value listed!

Any other boundaries?
Ideally they should keep as much distance as possible but I would consider a few exceptions depending on the situation.

Neil Beaty
GG(GIA) ICGA(AGS) NAJA
Professional Appraisals in Denver

 

[denverappraiser]

Heck Dave, I’m among the highest profile jewelry appraisers in the country, I wrote the questions and I squirm a bit when I think about them. That’s sort of why I ask. I can’t think of a single appraiser, including myself, who would pass the test of absolute independence on all of these topics. Like it or not, we are part of the industry and quite a few of us are long term and well connected industry veterans. By and large our clients benefit tremendously by this but it does come with a bit of baggage. Some of the things I brought up, like restricting our employees from having a second job somewhere else in the industry, may actually be illegal in some places. Others, like the mobile service or having a take-in arrangement with specific stores or auction houses are incredibly common among appraisers. Most appraisers get the majority of their work this way. I’m not singling anyone out from the list here as being any more or less independent because we’ve all been through this thought process and worked out our own interpretations, most of which are entirely reasonable, even if they aren't all the same. There is no real standard and abuse seems to be on the increase, perhaps for this very reason. I’m curious how the members of the community here perceive these issues. I guarantee this topic is going to grow as more and more people demand an 'independent' appraisal as part of their shopping process. My questions aren’t intended to pick on these fine people but yes, some are probably squirming over the whole idea of this conversation.

Anyone else care to step up and take the plunge?

Neil Beaty
GG(GIA) ICGA(AGS) NAJA
Professional Jewelry Appraisals in Denver

 

[surfgirl]

While I''d prefer ''independent'' in all ways, there is one exception I make for my current appraiser, who is listed as ''independent''. He does have his office just inside the front door of a jewelry store. The reason I dont mind is that he has a very stellar reputation in my city, and he has never, not even once - commented on anything that is going on or sold in the store, and they have no actual "affiliation", he rents space from them but he is a separate business. In fact, I once asked something about diamonds in the store he''s located in and he made a face and said, "I have no idea what they even sell, I never look..." I''ve also asked him about other sellers in my area and he doesn''t discuss that aspect of the local business. I do think if he knew I was looking at something from a seller he knew to be dishonest, he''d say something. I walk into the front door and go directly into his office so one doesn''t have to even look at the merchandise in the store part.

Also, just for contrast, I went to another, new to me, "independent appraiser" in town and realized when I walked into his shop that he is the co-owner of an actual jewelry store. No way is that independent. And in fact, he tried to diss my stone at the time, and sell me a new one at the end of the appraisal...needless to say, I would never use him again for anything.

 

[strmrdr]

Date: 2/18/2008 1:16:36 PM
Author: denverappraiser
Heck Dave, I’m among the highest profile jewelry appraisers in the country, I wrote the questions and I squirm a bit when I think about them. That’s sort of why I ask. I can’t think of a single appraiser, including myself, who would pass the test of absolute independence on all of these topics. Like it or not, we are part of the industry and quite a few of us are long term and well connected industry veterans. By and large our clients benefit tremendously by this but it does come with a bit of baggage. Some of the things I brought up, like restricting our employees from having a second job somewhere else in the industry, may actually be illegal in some places. Others, like the mobile service or having a take-in arrangement with specific stores or auction houses are incredibly common among appraisers. Most appraisers get the majority of their work this way. I’m not singling anyone out from the list here as being any more or less independent because we’ve all been through this thought process and worked out our own interpretations, most of which are entirely reasonable, even if they aren''t all the same. There is no real standard and abuse seems to be on the increase, perhaps for this very reason. I’m curious how the members of the community here perceive these issues. I guarantee this topic is going to grow as more and more people demand an ''independent'' appraisal as part of their shopping process. My questions aren’t intended to pick on these fine people but yes, some are probably squirming over the whole idea of this conversation.

Anyone else care to step up and take the plunge?

Neil Beaty
GG(GIA) ICGA(AGS) NAJA
Professional Jewelry Appraisals in Denver

You didn''t ask but I have no problem with an appraiser working with Auction houses or estate liquidators as long as the paperwork used at auction is a report not an appraisal.

 

[Modified Brilliant]

Bottom line...."independent" means different things to different people. We (appraisers) all have
the right to make an honest living. Disclosure is key if you wander into a grey area. Be upfront.

I consider myself "independent" because I own my own business and my office is in a non-jewelry related
office building. I make my own decisions and act in the absolute best interests of my clients.

I have taken several consumer related problem cases and worked with clients at no charge this past year.
I work hard to help rid our industry of people who deceive, cheat, misrepresent and otherwise hurt the consumer.
I probably couldn''t get this done if I was working in a store or for a specific company.

My independence helps me get things done on my own terms..looking out for your best interests.

An interesting topic and I''m sure there will be many definitions of "independence."

Jeff Averbook,GG
Graduate Gemologist since 1986

www.metrojewelryappraisers.com