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FTC Surfs the Net: Compliance is Better, But Not Great - Feb 2000

The Diamond Registry recently attended a luncheon at the Waldorf-Astoria for the Jewelers Vigilance Committee, which everyone agrees has been greatly reinvigorated with its new director, Cecilia Gardner.

Among the notable guests at the luncheon were Elliot Spitzer, attorney general for the state of New York, and Jules Polonetsky, the head of New York city’s Department of Consumer Affairs. Both called the JVC a unique organization and praised it for safe-guarding the jewelry industry’s integrity.

The most valuable speaker was Elaine D. Kolish, the Federal Trade Commission’s associate director of the Division of Enforcement, which oversees the FTC’s Guides for the Jewelry Industry. She talked about the results of a Federal Trade Commission review of jewelry web sites — which had just been released that day — and noted that most sites still do not follow the basic FTC Guidelines. But compliance with the Guides has improved from a similar "surf" last year, she said.

The study, which surveyed 71 jewelry-selling sites, showed sites advertising diamond carat-weights did the best job of compliance, with 75 percent of them following the rules, up from 58% in 1998. (Still, one out of four are cheating the public.)

Diamond carat weight claims must be accurate to the latest decimal point. But when claims are made using fractions and the diamond does not weigh exactly the advertised amount, the Jewelry Guides state that sellers should tell consumers that the weight is not exact and provide the tolerance (or weight range) being used for the particular fraction.

However only 12% of the sites advertising gemstones, and 44% of the stores advertising pearls, followed the rules.

The FTC will send e-mail to those sites that may contain potentially deceptive claims. If they don’t comply, the FTC may also take legal action.v


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