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Diamond Enhancement Labs’ Failures and Diamond Market

1990s: Diamond Enhancement Process Disappoints Diamond Dealers

Summer 1999

In a joint announcement by the American Gemological Laboratories (AGL) and the Gemstone Standards Commission (GSC), C.R. Beesley, President of AGL and Director of Research for the Commission said, "We are well aware of the technology used in this process. Despite the representations made by Pegasus, it is clear that this enhancement procedure will fall under the FTC guidelines. Therefore, disclosure is essential, not optional."

Eli Haas at the Diamond Dealers Club of New York (DDC) meeting said, "Everybody is up in arms about the LKI situation, I believe that De Beers is spending 24 hours a day trying to find a way to recognize [the process]." At a meeting with the Federal Trade Commission, Haas stated the opinion of the DDCNY "The agreement we have now with GIA, LKI and GE only gives us breathing space." The DDCNY wants the FTC to issue a special ruling to add the GE process to a list of diamond treatments that must be disclosed, thereby making it illegal to sell a GE processed diamond without full disclosure. When asked what’s so bad about the GE process situation, Haas responded, "What if people could make $100 bills that look and act just like the real thing and nobody would be able to tell the difference until a year or 5 years from now?"

AGL also offered a defense of the GIA’s failure to identify the new enhancement. Beesley said, "The methodology used by Pegasus to establish the non-detectability of this enhancement is invalid. No one had an opportunity to develop a platform for analysis and neither GIA nor any other lab had good reason to test for a new enhancement procedure." Beesley further stated that detection is not only possible but probable in a relatively short time.

When asked whether the industry might see some cooperation amongst the various laboratories in this identification process, R. Esmerian, Chairman of GSC, answered, "I wish labs would coordinate on even simple issues. None of the labs really work together and it’s a disaster for the trade." Without mentioning specific jewelers or manufacturers, Esmerian continued, " The labs are meant to be removed from the merchandizing of gems. Unfortunately there is a lack of knowledge and a lack of disclosure which plays into the merchants hands and some of the merchants are happy to have that continue."

Esmerian, who works with Gemcore, a not-for-profit laboratory for colored stones and colored diamonds which has been operating for 8 years, was quite clear in his assessment of the overall situation, "We’re doing it totally to ourselves and our industry. This latest development from Pegasus and GE is just the latest indication that it’s not some asteroid that’s being hurled at us from outer space, but rather that we’re doing it ourselves within our own family."

Esmerian stated that he and Gemcore have been working with Beesley on the issue and the two hope to bring the situation to a rapid and definitive close. Esmerian added, "We are confident that our efforts will be successful in reducing the level of anxiety surrounding these pressing enhancement issues. Through a coordinated research effort we plan to insure that confidence in both diamonds and colored stones will be effectively reinforced."


(Wholesale Diamond & Certificated Diamond in


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