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Are GIA Gem Trade Laboratories not "independent"?

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Richard Sherwood

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I have heard it stated that an appraiser who does work for dealers is not truly "independent", because their livelihood is connected to the income they receive from the dealer, hence the capacity for being "biased" may creep into their work. Over-grading, over-pricing, omitting all the facts, etc.

My question is this. GIA does reports for dealers only. I'm not sure about AGS. I think that EGL will do reports for privates and dealers. AGL in New York will do reports for privates as well as dealers. Dave Atlas' AGA lab does both private and dealer work, as well as my own lab.

Are all these lab's truly not "independent"? In particular, focusing the question, would the GIA Gem Trade Laboratories work be considered "tainted", or "biased"?

Rich, GG
Sarasota Gemological Laboratory
 

Rook

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I was told buy a local vendor to be weary of GIA reports, because they are not as independant as one might think. Specifically he said that vendors who send a lot of work to GIA can get more lenient grading!

Any thoughts on that comment?
 

Architect

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Dec 11, 2002
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Rook,
The vendor who told you this, does he carry primarily EGL certified diamonds by any chance? I have noticed that a lot of vendors that carry only EGL certed diamonds try to discredit GIA reports since it helps them sell their stones and makes their stones seem just as attractive as ones with GIA certs. I went to a vendor and aksed to see some diamonds and she brought me out all EGL diamonds. When I asked to see GIA certed diamonds, she told me that the EGL ones were just as good and asked why I only wanted GIA certed ones. I told her that GIA was the only lab that I knew of that did not grade stones that were enhanced and their reports were more strict with grading. She told me I was completely wrong if I thought that EGL ever had enhanced diamonds...then a little later she admitted that EGL used to be less strict and did grade enhanced diamonds but that they were just as good as GIA now. How are we supposed to believe vendors when they try double-talking about the certed diamonds they carry? I still only trust GIA and that's the lab where the diamond I bought last week is from. :lickout:
 

Richard Sherwood

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It's interesting that someone was warned to be careful of GIA certs. In the industry GIA has almost a "godlike" status. Supposedly the end of the road for all disputes, with their grading taken as gospel.

Rich, GG
Sarasota Gemological Laboratory
 

Richard Sherwood

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The statement "that vendors who send a lot of work to GIA can get more lenient grading" is what I'm talking about, though.

That's a case of speculative bias because the GIA does work for dealers. Does this mean they are not to be considered an "independent" lab?

Would they be considered an independent lab if they did work for both privates and dealers? Or for privates only?

Traditionally, to be considered an independent appraiser it was required that the appraiser not be engaged in buying or selling.

This slant that the appraiser might not be considered as "independent" if he does work for the trade is one I had never heard before posting on these forums. Frankly, it bothers me. I never even considered that someone might infer I'm not an independent appraiser because I do appraisals for both dealers and privates.

In my mind, I consider dealers as one of the largest consumer groups of gem buyers and lovers. They also want to know if things are real, and how much they're worth. Many of them are true connoiseurs of gems, and want to know fully the quality of a gem they're considering or have purchased. Most are not gemologists, and appreciate the additional security of a professional gemological opinion.

Is it fair to refuse them the expertise of an "independent" laboratory's opinion? Should a lab lose it's "independent status" if it agrees to grade or appraise a dealer's stone?

Alternatively, should a lab that appraises dealer's stones stick to that only, refusing to do stones for the public? If so, would they then be considered "independent", or once again, "biased" because their livelihood is dependent on those dealer's continued business?

Rich, GG
Sarasota Gemological Laboratory
 

mike04456

Brilliant_Rock
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This slant that the appraiser might not be considered as "independent" if he does work for the trade is one I had never heard before posting on these forums. Frankly, it bothers me. I never even considered that someone might infer I'm not an independent appraiser because I do appraisals for both dealers and privates.
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That really seems like splitting hairs to me. There's no such thing as true objectivity. Anyone working for a living is going to be biased toward keeping their job! I think problems only arise when there are obvious, competing interests at stake, as you would get with an appraiser who also sells diamonds.

I don't think there are truly competing interests with an appraiser who works for the trade and the public. Sure, an appraiser who gets a reputation for "tweaking" his reports for favored customers might attract some unscrupulous dealers, but most would shy away from him/her because 1) they need reliable reports as much as anyone else and 2) most people in trade take their integrity very seriously and would not want to be associated with such a person. This is a fairly small industry, and word about that kind of thing gets around. Bad reputations rub off on people who deal with them. Dealers and appraisers know that, and whatever pressure there might be to give favorable reports is balanced by the need to preserve a good reputation.
 

oldminer

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We are "Independent" in that we do not consider our work as belonging to only the party who paid for our services. We use a fairness doctrine and a code of ethics that gives us an opportunity to serve the public and the trade in an even and fair manner.

No lab is truly independent in the jewelry business. Each one could be considered biased if one sees the money is paid by one party or another. Whoever pays is always suspected on having that lab somewhat in their pocket.

That's why we and others work so hard to develop a great reputation and excellent credibility. We want to ensure that you can check out not only our credentials, but our history of giving sound and seeming unbiased advice to anyone.

I admit to one bias. I want the jewelry business to do well and to remain viable. I do all I can to advise, teach and keep my own business above board. I won't lie for any vendor, but I don't go around calling people names or attempting to hurt them in some way. That is not professional or ethical. We foster good sales through increased consumer knowledge. Any other appearance of bias is only a perception and not a reality.

The GIA and all others who accept work for a fee need to do what they can to make their reputations the best possible and the consumers who rely on these reports content that they have accurate information. Not every lab does their utmost in this regard, but all successful labs make an attempt at it.
 
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