Scam Jam: Fraud, Fakes and Other Industry Misdemeanors of 2024 

Photo gallery of fraudulent diamonds and a broken jewelry-store window

This year saw an increasing number of industry activities that were sometimes illegal, and many times morally dubious. 

From lab-grown diamonds submitted for grading as natural, to a surge in counterfeit inscriptions, stolen diamonds, security breaches and hacking, and dealers swapping fake stones for real ones, 2024 had it all. These cases show some of the more troubling parts of the trade. 

Here are some of this year’s swindles, and the steps taken to prevent them: 

  • The International Gemological Institute (IGI) received a pear-cut, 6.01-carat synthetic diamond submitted as natural, it said in January. The diamond’s carat weight and physical description were a close match to the online data for a natural diamond graded by the Gemological Institute of America (GIA), whose inscription it bore. 
  • The GIA went to the effort of offering a new service — same-day verification — in an effort to combat the rash of lab-grown diamonds bearing fraudulent inscriptions
  • After four pieces of jewelry and two additional diamonds, each over 4 carats, and together with the jewels totaling $475,000, were stolen from a home in Colorado, the GIA worked with Boulder law enforcement to identify the stones and bring the perpetrator to justice. 
  • In February, Gemological Science International (GSI) issued a warning to the trade after coming across a “notable increase” in jewelry set with pink, yellow and brown lab-grown diamonds posing as natural. 
  • The US sanctioned Zimbabwe President Emmerson Mnangagwa for corruption in connection with gold and diamond smuggling. The Treasury Department’s Office of Foreign Assets Control (OFAC) said he provided a “protective shield” to smuggling networks and directed officials to “facilitate the sale of gold and diamonds in illicit markets,” taking bribes in exchange for his services. 
  • In April, the UK’s Advertising Standards Authority (ASA) ruled that Skydiamond may not use advertising with “misleading” terminology that fails to make it clear their diamonds are not natural. The rebuke came on the heals of a complaint filed by the Natural Diamond Council (NDC) for ads featuring text such as, “We make diamonds using four natural ingredients, the sun, the wind, rain and something we have too much of, atmospheric carbon.” 
  • In May, Christie’s had to postpone a watch auction following a security breach that caused it to take its main website offline. After investigating, the company found that the hackers stole data, including personal client information. 
  • A group of approximately 20 people allegedly robbed a jewelry store in June using hammers and other tools to smash cases and grab merchandise. During a police pursuit, suspects threw some of the stolen jewelry out of the car window, but authorities managed to recover only a portion. 
  • New York diamond dealer Manashe Sezanayev was charged with stealing from diamond merchants by replacing $460,000 worth of natural diamonds with synthetic stones. The operator of Rachel’s Diamonds in New York’s diamond district was accused of making appointments with diamond merchants to view stones he claimed to be interested in buying. During the visit, he allegedly swapped the stones with lab-grown ones he had not only previously cut to match but had also given forged GIA laser inscriptions. 
  • In September, Jewelers Mutual and Jewelers’ Security Alliance (JSA) issued an urgent warning to the trade about the increasing severity and frequency of jewelry-store robberies by organized crime groups, primarily from South America. JSA vice president Scott Guginsky said he had not seen that “level of severity and frequency in these types of attacks in all of my 30 years involved with jewelry crimes.” 
  • Earlier this month, a manufacturing supervisor at a luxury jewelry company was sentenced for stealing more than $1.7 million in gold, silver and platinum from his employer, which, according to his LinkedIn profile, is Tiffany & Co. A judge ordered Benjamin Preacher to serve 59 days in prison, followed by two years of supervised release, including 10 months of home confinement and 200 hours of community service. 

Main image: Some of the fraudulent diamonds and a broken jewelry-store window. (IGI/GIA/GSI/David Polak)

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Scam Jam: Fraud, Fakes and Other Industry Misdemeanors of 2024 

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