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Gerstein explains how consumers are being misled by the conflict-free label

Mar 17, 2010 6:30 PM   By Rapaport News
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RAPAPORT...







Statement from Brilliant Earth:

Visionary leaders in the diamond industry are reacting to recent events in Zimbabwe that illustrate the failures of the Kimberley Process (KP), which the industry relies on to prevent diamond sales from funding conflict.

In recent weeks, it has become clear that blood diamonds funding murder, forced labor, rape and political oppression in Zimbabwe are reaching global consumer markets labeled as “conflict-free.” See the fact sheet that follows for more details, which are also available online at http://www.brilliantearth.com/.

In recently resigning from his position at the World Diamond Council (WDC), highly influential industry expert Martin Rapaport protested the industry’s inaction: “Tens of thousands of carats of blood diamonds are now in dealers’ inventories and jewelers’ showcases — and are being actively sold to consumers....Instead of eliminating blood diamonds, the KP has become a process for the systematic legalization and legitimization of blood diamonds.”

Rapaport was a principal architect of the KP, along with Ian Smillie, who has also criticized it as a failure.

“Consumers are being misled by the 'conflict-free' label. With a broken system, it’s not enough to accept a diamond’s Kimberley Process certification; you have to know the practices of the mine it came from,” said Beth Gerstein, the co-founder of Brilliant Earth, a national online jeweler that has created a new business model in response to the KP’s failures.

"There are other certification and mining guarantees that a retailer can use in place of the flawed Kimberley Process," Gerstein continued. "Unfortunately, it requires a proactive and ethical retailer to now make sure blood diamonds aren't in showcases and very few are willing to put in the effort to do so. We've shown it's possible to sell jewelry consumers feel good about and hope other retailers join us in reform of a notoriously harmful industry."

2010 Blood Diamonds Fact Sheet

While the diamond industry has convinced the public that the Kimberley Process Certification Scheme (KPCS) is keeping conflict diamonds off the market, recent events illustrate how the KP has failed to concern itself with the violent conditions under which many of the world’s diamonds are produced. The KP continues to certify diamonds from Zimbabwe, even though diamond mining there is causing unspeakable human suffering. Diamonds that have funded murders, forced labor, rape and political oppression are currently on the market with “conflict-free” certification.

1. Zimbabwe’s diamonds support war and human rights abuses.
Hundreds of civilian miners have been murdered by the Zimbabwean military, which, in 2008, seized valuable diamond fields in the country’s Marange district and continues to oversee production. Human Rights Watch (HRW) has documented mass murders, forced labor of both adults and children, torture, beatings and other human rights violations by the Zimbabwean military. The KP’s own investigators have also documented cases of rape.

Furthermore, recent actions by the Zimbabwean military indicate that it is secretly trading rough diamonds for weapons, thereby helping to fortify and prolong Robert Mugabe’s oppressive and antidemocratic regime. Mugabe’s government has illegally seized mining operations, ignored national court rulings and stolen diamonds out of the country’s central bank to line his party’s pockets.

Zimbabwe’s diamond production is currently valued at $33 million dollars annually, with over $150 million dollars smuggled out since 2003. The country is estimated to have over 16.5 million tons of diamond reserves available for mining.

2. Zimbabwe’s diamonds are being certified as “conflict-free” by the KP. 
After its last politically charged and disorganized meeting in November 2009, the KP failed to suspend Zimbabwe for its diamond mining abuses. The KP continues its inaction, even though Zimbabwe has not fulfilled its obligations and is threatening to voluntarily quit the certification scheme if standards are enforced. “We are trying to play it....following the KP, but we can do it otherwise...We can sell our own diamonds elsewhere," Mugabe told reporters on February 17, 2010.

Retaining its KP certification means that diamonds mined in Zimbabwe can be labeled as “conflict-free” and sold in international markets. According to diamond industry veteran Martin Rapaport, “Blood diamonds from Marange, Zimbabwe have been issued KP certificates and imported into the cutting centers, where they were cut and polished and then sold to dealers, jewelry manufacturers and retailers. Tens of thousands of carats of blood diamonds are now in dealers’ inventories and jewelers’ showcases — and are being actively sold to consumers...Instead of eliminating blood diamonds, the KP has become a process for the systematic legalization and legitimization of blood diamonds.”

3. Major jewelers are not acting to ensure that their diamonds are ethically acquired.
The KP has taken the feeble measure of temporarily banning the sale of new diamonds whose origins in Marange can be proved. However, HRW has warned that “there is no way to guarantee that Marange stones are not being mixed with those produced at Zimbabwe's other two mines.” In addition, the temporary ban does not affect Marange diamonds that already have KP certification. And despite the temporary ban, gems from the Marange district are being smuggled out of Zimbabwe and sold on the global diamond market.

Although industry leaders, including the WDC, have called on jewelers to maintain “vigilance” to prevent the sale of diamonds from the Marange district, a more appropriate response would be to call for an end to trading in all Zimbabwean diamonds. Unfortunately, many jewelers continue to sell Zimbabwean diamonds as conflict-free, while failing to demand an international system that can ensure that all diamonds are ethically mined.

Several weeks ago, Rapaport resigned from the WDC in protest of the organization’s willingness to mislead consumers about the integrity of the international diamond market. In his letter of resignation, he listed several recommendations, including this one: “The WDC should immediately communicate to the jewelry trade that KP certification and the WDC Systems of Warranty are insufficient and do not ensure that diamonds are free of human rights violations.”

4. Most consumers do not realize that they may be purchasing blood diamonds, even in 2010.
A 2004 Amnesty International survey found that 83 percent of U.S. jewelers say their customers "rarely or never" inquire about the source of diamonds. A similar study in 2007 found that 56 percent of jewelers do not even have an auditing procedure in place to prevent the retail of conflict diamonds. Those that do rely on the faulty KP certification.

Fine jewelry sales in the U.S. rose 14.3 percent from December 2008 to December 2009. Approximately 50 percent of the $57.8 billion U.S. jewelry market is derived from diamonds.

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Tags: Blood Diamonds, Brilliant Earth, Conflict Diamonds, Consumers, Government, Jewelry, Kimberley Process, Production, Rapaport News, World Diamond Council, Zimbabwe
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