TABLE OF CONTENTS

NEW NIGERIAN ORANGE GARNET HITS THE MARKET

By Robert Genis

When people think of garnets, most think automatically of small, inexpensive, dark red gemstones. The majority of Americans fail to realize some of the world's finest gemstones are garnets. Garnet occurs in a rainbow of colors. With the exception of blue, it is found in every color of the spectrum. For example, the bright green, highly brilliant demantoid, the bright yellow green to intense grass green tsavorite, and the pure orange mandarin garnets are sought after and coveted by collectors. Some garnets even change color, but they tend to be dark. Other garnets include the new grape, red to purple rhodolite, orange to red malaya, pink, green and yellow grossular, gold, orange and brown hessonite, red almandine and pyropes, and the combinations between these varieties. Garnets range from 6.5-7.5 in hardness. They are hard and durable gemstones that are ideal for jewelry or placing in a safety deposit box for collectors.

There is a new orange spessartite (also known as spessarite or spessartine) garnet find from Oyo, Nigeria, near Lagos in Africa. Although the stones are not as pure orange as the Namibian Mandarin Orange garnets, they tend to come larger, are cut better, have more brilliancy or life, and are cleaner. Of course, one advantage to collecting garnets is they are not normally enhanced. These spessartite garnets are also mined in Pakistan, Madagascar, Tanzania and California. Others sites include Norway, Myanmar, Sri Lanka, and Brazil.

The mining in Nigeria is in a small alluvial deposit. Gem spessartite is usually found in pegmatites. Presently, parcels are small and the extent of the production is not known, although the amount of goods appears limited, with a kilo or half kilo of rough occasionally found on the market. Most of the goods are too dark or too light. The material that is too light looks like straw. The material that is too dark blacks out. Many of the new stones have clarity problems, so you are looking for eye clean stones. The new find has produced goods up to 40-50 carats, unheard of in the Namibian Mandarin Orange garnets, where a carat size stone is large.

The color you are looking for is a rich, pumpkin, saturated orange. The primary color is orange with reds secondary and some brown overtones. Collectors should focus on the bright orange colors and shy away from the darkish colors. Avoid the stones that are reddish brown. These goods can be purchased from $100 per carat up to $1000 per carat for large, important, clean gemstones.

For beginning or new collectors, this is an excellent way to start your portfolio without investing large sums of money. Besides fancy sapphires, Nigerian tourmalines and Mandarin Orange garnets, what other collector gem can you buy for under $1000? For those with complete gem portfolios, you might want to speculate and purchase one or two of these gems. There is little downside to owning this orange garnet because they are relatively inexpensive. Mandarins have continued to escalate in the last five years due to the small Namibian production. These gems are an excellent alternative for those who enjoy larger gems.

We anticipate the new Nigerian orange garnet to follow the Namibian Mandarin garnets up in price. If you are looking to start a collection or diversify your portfolio, feel free to contact National Gemstone at 1-800-458-6453.

BURMA RUBIES: UNDERSTANDING THE AGL COLORED GEMSTONE GRADING REPORT'S ECA COMMENT

Colored gemstones are valued for their intensity of color. When evaluating ruby, irrespective of the source, the more primary color exhibited, the more valuable the gem; or the redder the better. Secondary colors in ruby are always pink, orange, or purple. Neither the trade nor collectors can agree on which secondary color is preferred. However, primary color is not everything. Tone is also an important factor. Rubies with 90 (blackish) tones are discounted compared to rubies with tones between 65-85 (medium-dark).

When the AGL devised their grading system (based on the purity of primary color) in the late 1970's, Burma ruby production was practically nil. The majority of rubies graded at the lab were from Thailand. That is not to say the lab did not grade Burmas, but they were few and far between. Recently, the production of Burmas has increased and the lab is seeing more goods. As a general rule, Burmas are not as red as Thai stones, yet they are obviously valued significantly higher than Thai stones in the market.

To remedy the emerging discrepancy between the generally accepted notion that "the more red, the more valuable" and the market reality of the higher value of these less-red Burma rubies, the lab created what members in the trade call a jump/skip Estimated Commercial Acceptability, or an ECA with the exponent 1. Look at the Burma ruby colored stone grading report under comments. See "Color grade based upon standard ruby scale: 3.5-4.0/70-80." Now look at "Color Grade: ECA1: 2.5/80." What this means is if the stone was a Thai ruby, it would grade as a 3.5-4.0/70-80. However, since the stone is an unheated Classic Mogok, it is accepted in the trade as a 2.5, or approximately 1 to 1 1/2 grades higher. In other words, if you had two rubies with an exact same primary color, one from Thailand and the other an unheated Classic Burma ruby, the trade would value the Burma stone over the Thai stone. The purpose of this designation is to give a reference point to all the Thai rubies graded over the past 20 years. Please note, if the stone is heated, the ECA will probably be one grade higher, if unheated 1 1/2 to 2 grades higher.

What does this mean to you visually? If you have never seen a Classic Mogok Burma ruby, here are some broad generalizations:

  1. Stones that grade with an ECA1 of 6.0, 5.5, or 5.0 on the top line look pinkish.
  2. Stones that grade with an ECA1 of 4.5 on the top line look electric magenta.
  3. Stones that grade with an ECA1 of 4.0 or higher on the top line are red.
For collectors on a budget, the pinks are an excellent value. If you want reds, stay with 4.0 or higher colors.

DARING CAPERS REVIEW

The Learning Channel produced a fascinating re-creation special on the greatest daring international gem robberies. It aired the week of September 6-10. Here is a synopsis of the major crimes:

The Kennedy Airport
Two employees for Lufthansa Airlines devised a plan to rob the high value room at the Kennedy Airport. One of the employees, who owed money to his bookie, gave the plan to a group of criminals. The criminals received permission to execute the plan from the local Mafia that controlled the airport. On December 11, 1978, the robbers took over the Lufthansa warehouse and stole 72 boxes filled with cash and unmounted gemstones. The total from the haul was $7 million in cash and $1 million in gems. Each of the robbers received about $50,000 in cash and the Mafia took the rest. The robbery was so large the FBI began offering reward money larger than the robbers' take. One Lufthansa employee was arrested and given a 15 year sentence. He refused to cooperate. Later, he decided to talk, but the contact person he named was already dead. The leader of the gang received a life sentence on another charge and died at 53. Before he died he said he wished he had never heard of the robbery. Whoever touched the money was "cursed". Most of the robbers died and the money and gems were never recovered, presumed to be in the coffers of the Mafia.

Pierre Hotel Heist
In 1970, a group of robbers in New York had a brilliant idea. They would strike at fashionable hotels in the early morning hours, surprise the hotel staff, and rifle the safety deposit boxes. On August 7, 1970, they robbed the Regency and placed a safe and the boxes on a dolly and left the premises. Elizabeth Taylor was upstairs with over $2 million in diamonds and gemstones. Becoming more brazen, on October 11, 1970, they broke into Sophia Loren's suite at the Hampshire House and stole $500,000 worth of uninsured jewels. On January 2, 1972 they struck the Pierre Hotel at 4:00 A.M. and subdued 14 people in 15 minutes. The hotel had over 200 boxes. When they realized it was getting late, they commandeered the box list and only opened the boxes of prominent names. They finally opened 47 boxes and took about $10 million in jewels. They hired a person to be the go between with a new fence. However, the fence's partner was an FBI informant. An FBI sting netted about $250,000 in jewels and two of the robbers. Another $1 million worth of jewels was later found. The FBI refused to give up their informant and the two robbers received light sentences. The other two accomplices and 90% of the jewels were never recovered.

Plunder Under Nice
The wealthy left their valuables in the Societe General Bank on the French Riviera. In July, 1976, the bank managers went to open the bank vault. It took 6 hours to open the 20 ton vault door while customers panicked outside. They discovered the bank had been robbed via a tunnel. Inside the vault was written, "without arms, without violence, without hate." The gang, dubbed "The Sewer Rats", left behind 2500 pounds of equipment. They broke into 400 of the bank's 4000 boxes. The caper became known as the "Heist of the Century". The robbers ended up with over $10 million in cash, jewels, and precious metals and became instant folk heroes. A local photographer was arrested. While in custody, the French police demanded he confess to the crime or they would arrest his wife. Meanwhile, they searched his house and discovered dynamite and weapons. He confessed. The photographer stated he hired the French Mob to provide the diggers, engineers, and electricians for the job. Eventually 3 of the robbers were acquitted and three received 5 years in prison. The photographer, in a judicial meeting in May, 1977, jumped out a second story window and fled in a daring escape. His lawyer expected he would receive a two year sentence because the victims' money had been reimbursed by the bank. He spent the rest of his life on the run, writing mocking letters to the French police before dying of cancer. His wife remained in Nice.

Reach for the Stars
In October, 1964, three "playboy" beachbums checked into a three room suite at the Regency in New York. During the night they hit all the hot spots, but during the day, they visited the American Museum of National History. They especially enjoyed the J.P. Morgan Hall of Gems and Minerals. One night they broke into the museum, climbed to the fifth floor, dropped via ropes to the fourth floor and entered the Hall through an open window. Two went inside and one was the driver. They stole 24 gemstones, including the 500 carat Star of India Sapphire, the DeLong Ruby, and the Midnight Star Sapphire. The security system at the museum had not been maintained in years!

The two main burglars flew to Miami. They fenced the unimportant gemstones, but the main stones were "too hot to handle". A bellhop at the Regency tipped the police. The police waited in the hotel until the driver returned. He was arrested and the next day the other two were arrested in Miami. They were also arrested for a burglary of Eva Gabor's jewels. Facing hard time, the burglars offered to get the gems back for a reduced sentence. Eventually 9 of the 24 stones were returned, including the Star of India and the Midnight Star. The three burglars received three years in prison. Later, six more stones were recovered, including the DeLong Ruby, but 9 were never found.

Miami Heights Spiderman
In 1996, a cat burglar defied the laws of gravity by scaling high-rise condominiums in Miami. In search of cash and gemstones, he would climb up to 10 stories without ropes, nets, or tools. He only stole real jewels and left the costume jewelry. The condos were viewed as fortresses by the residents and many owners never locked the sliding glass windows of their balconies. Detectives finally understood how Spiderman was conducting these burglaries when they noticed smudge marks on the sliding glass windows where the burglar pressed his face to look into the condos. Soon Spiderman was operating in a 300 mile radius throughout South Florida. One night, a man saw Spiderman attempt to enter his high rise condo. Based upon this encounter, the police made a composite sketch of Spiderman. In early 1998, police finally discovered a valuable clue. Not only was Spiderman stealing gemstones and jewelry, he was also stealing credit cards. Based upon Spiderman's use of a credit card, they discovered he was driving a green SUV and always bought gas at a specific station. They staked out the gas station for a month before Spiderman showed up. After running his license plate, they discovered he had 18 felony convictions and had been an Army paratrooper. They put a tracking device on his automobile and caught him after a job at the Bristol Towers condominium. At trial, a jeweler stated he bought $8 million worth of gemstones and jewelry over four years. Spiderman is presently serving a 30 year sentence.

EMBEZZLER CONVERTS CASH TO DIAMONDS

Martin R. Frankel faces federal charges of fraud and money laundering and is accused of embezzling at least $215 million, possibly as much as $3 billion, from insurance companies in five states. Before disappearing, Frankel turned millions of dollars in embezzled investments into gold and diamonds. Frankel fled his Connecticut mansion during a fire aimed at destroying his files and notes regarding international extradition laws. Frankel bought about 3,000 pounds of gold for more than $10 million from Monex, a gold dealer based in California. Due to the fact the profit on even such a large gold transaction was probably only $100,000, the government is not pursuing Monex at this time.

A retail jeweler contacted wholesaler Worldwide Diamond Co. of California and said they had a client who wanted to buy $10 million in diamonds. The purported story was an "industrialist" wanted to hedge his portfolio with diamonds as a precaution against the Y2K computer bug. Worldwide Diamonds was skeptical of the sale and demanded a bank wire for $10 million. Two days later the money appeared via wire transfer from a company in Geneva. Worldwide obtained the diamonds (1 - 3 carat, D-H, VS-SI stones) and had them flown to a private, predawn meeting at Teterboro Airport in New Jersey. The diamonds were delivered to a squad of security guards in two suitcases; the diamonds and the grading documents.

About a month later, the retail jeweler called and said the client wanted $40 million more diamonds. Worldwide Diamonds said that was impossible, but they could obtain $10 million more. They were afraid of disrupting the diamond market and causing prices to rise as they bought. Another $10 million was transferred with no problems. Worldwide delivered the same types of diamonds, including a 12 carat D-Flawless and a 16 carat H-VS1.

The wholesaler paid off his suppliers and had about $1 million, which included some of the profit to the jeweler, in his bank account. Suddenly, his Beverly Hills Bank Leumi account was frozen by the federal government. Federal prosecutors say they froze the account because the money may have been involved in fraud and money laundering activities. This amount is the largest pool of funds identified so far left by Frankel. The FBI had 24 agents searching the globe for Frankel. They contacted the world's major diamond bourses and asked members to look for special stones in the parcels.

Four months after his disappearance, on September 4, 1999, Frankel was arrested at the Hotel Prem in Hamburg, Germany without incident. He was traveling under an assumed name with a phony British passport. It could be several months before he is extradited back to Connecticut. The FBI found diamonds, cash, and a computer in his room. Frankel spent most of his time hiding in Europe. Reports indicated Frankel was low on cash. He had $500,000 in an Italian bank under an assumed name that he was unable to withdraw. It is also unclear how many of the diamonds he purchased he actually had in his possession. The remaining diamonds were too "hot" to sell. There is also some question whether Frankel actually took possession of the gold from Monex.

INTERNATIONAL MARKET UPDATES

Mogok Burma
Burmese miners and their joint venture owners are fighting over promised profit splits that have not been delivered in over three years. Miners may quit mining and return to the lucrative drug business. Besides heroin and opium, reports indicate the Burmese are also involved in the making, selling, and distribution of methadrine across Thailand.

Mogok is often closed to foreigners and some non-Burmese dealers report not being able to get to the mines. Rumors also indicate one of the mines experienced a cave-in. Supplies for goods remain steady from Burma. However, based upon the political and mining realities of the region, it is unclear how long this will last. The demand for gem quality, unheated Mogok goods remains strong.

Trouble was expected politically in Burma by the opposition to the government on 9/9/99, a significantly unlucky number in Asia. Nothing serious happened.

Colombian Emeralds
The Colombian economy has not been worse in over 60 years. The primary reason is the civil war. Recently, Colombia has seen a rash of spectacular guerrilla attacks and kidnappings. The US gives Colombia $280 million per year and Colombia is requesting another $3.5 billion in international aid. Many are demanding US intervention in the conflict.

The Colombian currency is collapsing, unemployment is rising, and the government budget is running a deficit. The earthquake this year will cost the government another $3.5 billion. International credit agencies are downgrading Colombia's credit ratings.

President Pastrana has given the revolutionary Armed Forces of Colombia, or FARC, control of a land area the size of Switzerland. FARC is using this area to stage attacks closer to Bogota.

This should be bullish for the emerald markets because the supply of emeralds is down significantly. However, the recovery seems a long way off. Emerald dealers have been dropping emeralds or phasing them out by diversifying their stock.

Treatment Front
Gemtec and the CGIE laboratory of Bogota, Colombia have created a new emerald filler, named "Permasafe". It is reported to be very similar to Arthur Groom's Gematrat process.

Meanwhile Arthur Groom has proposed an emerald enhancement classification system. Here are the proposed degrees of emerald filler:

  1. Heavily Enhanced-25% of emeralds
  2. Moderately Enhanced-60% of emeralds
  3. Lightly Enhanced-10% of emeralds
  4. Not Enhanced-5% of emeralds.
It is expected the Heavily Enhanced would drop in price, Moderately Enhanced would be the norm, and Lightly Enhanced or Not Enhanced would rise in price.

GIA Emerald Research
The GIA published the first part of its research study on emeralds in the Summer issue of Gems & Gemology. How did the GIA conduct the research for the past 1 1/2 years? The researchers surveyed 33 leading emerald dealers worldwide, asking them the types of fillers of which they were aware. Only 12 dealers responded and the GIA tested 39 fillers.

The researchers tested all of the fillers "loose", or outside of emeralds, and the most common substances in filled emeralds. They were looking for obvious signatures to determine which types (oil, resin, or synthetics) were present in the emeralds. The GIA looked for flash effects, utilized infrared spectroscopy and Raman microspectroscopy, and fluorescence.

The main conclusion is it is not currently possible to distinguish every filler used by the emerald trade today using basic gemological methods and testing. This is especially true when different fillers have been mixed. This can occur, for example, when an oiled emerald is not cleaned thoroughly before being Opticoned. However, common synthetic fillers, such as Opticon 224, Araldite 6010 and Epon 828 do have signatures under infrared and Raman spectral examinations.

The GIA concludes there probably is no "magic bullet" filler for the emerald industry. There is probably no one specific filler that is the best or that will be universally used. New fillers and combinations of existing fillers are being used all the time.

Dealers, consumers, and trade organizations awaiting the GIA research study may be disappointed with the research. The GIA study will continue to determine the durability of different fillers, how well they enhance the emerald's appearance and how well the fillers hold up over time and with normal wear. To obtain the study, write to the GIA at:

GIA Gems & Gemology
5345 Armada Drive
Carlsbad CA 92008.

Tanzania
The Sukuma people of the Shinyanga region south of Lake Victoria believe in witchcraft. Today, older women in rural Shinyanga are "becoming an endangered species" according to the Tanzania Media Women's Association. Police recorded 50 witchcraft-related murders in Shinyanga last year. The recent boom in mining for gold, diamonds and gemstones and the collapse of a 25-year experiment in socialism has caused a rash of rural women being killed. Medicine men and diviners say they are witches and are responsible for misfortunes of friends and relatives. Sacrifice is utilized to bring good fortune.

Northeast of Shinyanga, in a town near De Beers' Mwadui diamond mine, residents dig up their own plots of land in search of the precious stones and put their faith in witchcraft. The miners regularly consult medicine men to determine where to dig for gems.

In other news, tsavorite was recently discovered near Ruangwa. Approximately 3000 miners were at the sight this summer, but most have left for more promising mining. The tsavorite is a green bluish color. The tone is neither too dark or too light. The problem is that most of the goods are below a carat and the gemstone typically has clarity problems.

Madagascar Sapphires
Madagascar is becoming known for its ruby, sapphire, emerald, tourmaline and garnet. An American company recently bought 37 concessions in an attempt to control the sapphire production. Expect to see new production soon from this locale, although most stones are not collector quality as they look like Sri Lankan goods. However, an occasional fine gemstone is produced from the mines.

Diamonds
DeBeers
Sales of rough diamonds by De Beers' Central Selling Organization (CSO) in the first half of 1999 were US$2.45 billion, 44% higher than last year. In 1997, sales were US$2.88 billion, the period prior to the Asian crisis in mid 1997.

To deal with the international oversupply, DeBeers drastically reduced the sales of rough diamonds until last year. Sales in each of the three half-years covering this period were down to around US$1.7 billion. DeBeers remains cautiously optimistic because of the better-than-expected Christmas period in retail sales in the US where consumer confidence is high, the signs of recovery in the Far East, and Europe's very steady buying of diamonds.

Russia and the University of Florida
The University of Florida and Russia are creating gem-quality diamonds with man-made heat and pressure. In the past year, the team has created yellow, amber, green and colorless diamonds as large as 1.6 carats. The research is being funded by a small company that intends to sell what it calls "cultured diamonds" for jewelry and for use in high-speed electronics. Gem-quality diamonds have been made since the 1960's, but the machines were enormous and the cost exceeded that of mining natural diamonds.

However, in the 1980's, a team of Russian scientists in Siberia developed a small, high-pressure, high-temperature machine capable of making low-cost, gem-quality diamonds. The machine is about the size of a washing machine. The device starts with a carbon source and a piece of a real diamond called a "seed". The machine squeezes the pressure to 850,000 pounds per square inch. Other equipment heats the seed to 2,000 to 3,000 degrees Fahrenheit. This high pressure and high temperature transform the seed into a larger diamond.

The machines require little electricity and are inexpensive to build. However, the Russian researchers were unable to consistently produce diamonds of the same color or quality. The task of the University of Florida is to control the process. It takes about 50 hours to grow a one-carat diamond and the researchers expect to be producing diamonds up to 5 carats or larger in the future.

COLLECTORS CORNER

Colored Gemstone Awareness
Ed Note: The two lowest scoring stones in the survey are two of my favorite gemstones!

A professor at the University of Washington recently conducted a survey of 460 women according to an article in Jewelers Circular Keystone Magazine (201 King of Prussia Road, Radnor, PA 19089). According to the survey, over 90% of women are aware of ruby, emerald, and sapphire. About 50% would consider purchasing one of the Big Three. Approximately 80% of the respondents are aware of garnets and 20% would consider owning one. Tanzanite, tourmaline and alexandrite have about 30% market awareness, although more respondents would rather own tanzanite than tourmaline or alexandrite. Tsavorite was only known by 7.7% and only 2.9% would consider owning one. Spinel was known by 5.9% and only .07% would considering buying one.

Nigerian Tourmaline
Reports indicate the new Nigerian tourmaline mine is already played out. A small batch of these goods is now on the market. The reds look like gem red spinel and hot fuchsia spinel. The only downside is these stones are moderately included, similar to the Ouro Fino rubellite find in Brazil during the 1980's. The colors are beautiful and probably geologically linked by trace elements to the inclusions. If available, serious collectors should probably put one of these stones in their portfolio.

Russian Synthetic Diamonds
The red synthetic Russian diamonds we have seen recently tend to black out. However, the blues are light and bright in color. Prices for these goods can reach over $5000 per carat. Although this seems expensive, try to buy a natural blue or red!

Australian Pearl
A gigantic 23 mm round pearl was found off the coast of Australia in July. It is the size of a quail's egg and could fetch $500,000.

DeBeers Millennium Jewels
De Beers unveiled the "Millennium Jewels" diamond collection in London. The main stone is a 203 ct. D-flawless, pear shape. Eleven blue diamonds are also part of the collection, with a combined total weight of 118 carats. The blues were mined at De Beers' Premier Mine in South Africa. The blue diamonds range in size from 5.16 carats to the 27.64 carat Heart of Eternity, described as vivid blue.

IN THE NEWS

Wall Street Journal, August 5, 1999
Of course, jewelry is hot. Like sales of other luxury items - furs, expensive cars, and vacations - jewelry sales are growing at double-digit rates, thanks to the booming economy and powerful stock market. Of the $40 billion a year Americans spend on jewelry, a large, but unspecifiable percentage is sold in high end stores - those whose highest priced items cost at least $5000, and sometimes millions.

The future looks even brighter. Most retailers market to the young. But jewelry sells most heavily to people between 55 and 64, and guess which demographic group is marching headlong into that category? ...The baby boomers. Consumers between 45 and 54 spend twice as much on jewelry than those under 25.

The Gang That Loves Glitter
A shadowy group of jewelry thieves turns to deadly violence.
Newsweek, Sept. 6, 1999
By Peter Annin and Jon B. Rhine
The first time they robbed Joe Tenhagen, a Miami gem dealer, the bad guys used the oldest trick in the book - they slit one of the tires on his car, causing a slow leak. When Tenhagen, driving home, pulled over to change the flat, the thieves sneaked up, smashed a window and got away with $30,000 worth of precious stones and equipment. "I was a wild man," Tenhagen says. "They had outsmarted a street-smart guy." The cops asked Tenhagen if he wanted to offer a reward. "Reward?" he said. "I'll kill the bastards."

He meant it. Six weeks later the gang came to his house to rob him again and Tenhagen, yelling in fury, pulled out a .45 and chased them to their getaway car. Tenhagen, who said he saw one of the perps aim a revolver at him, fired 10 shots and fatally wounded one of the thieves. The other two men, both illegal aliens from Colombia, were caught and went to jail. They will be deported when they get out, probably sometime in 2002 or 2003.

Like hundreds of other gem and jewelry dealers across the country, Joe Tenhagen was stalked, set up and robbed by a criminal mob that preys on the American jewelry industry. To police and jewelers alike, the mob has been known for at least 10 years as "the Colombians", although it actually includes men and women from at least five Latin American nations, many of whom enter the United States with forged documents. According to the FBI and many local police officials, the gang consists of as many as 2,000 thieves organized in teams of 10 to 20 individuals. These teams are commanded by bosses known as "dons" and underbosses known as "hombres", and they are usually based in cities like Miami, New York, Chicago and Los Angeles.

But the Colombians move all around the country to target gem and jewelry salesmen where they are most vulnerable - on the road. According to cops and industry sources, the thieves use sophisticated surveillance techniques and a repertoire of diversionary tactics like the flat-tire trick. They also use guns, and some say they are becoming more violent. So far this year, according to the Jewelers' Security Alliance, a New York-based trade group, the Colombians have pulled off 133 jewelry robberies worth $33 million, including a $4 million heist in Long Beach, Calif. "Dollarwise, this is the worst year on record," says the alliance's John Kennedy. "And we've never seen this level of violence before."

Essentially, the gang has zeroed in on a longstanding security lapse within the jewelry industry - the tradition of sending out salesmen to show real jewelry, instead of photographs or fakes, to retailers. That means the contents of a single salesman's case can be worth $1 million - easy pickings, considering the fact that until recently, few firms provided their reps with escorts. When the thieves spot a traveling salesman, they may follow him for days, using several different cars to disguise the surveillance and, in some cases, electronic tracking devices to maintain the tail. Then they pounce.

In the past, they usually relied on distraction tactics. One favorite is to have a gang member dump mustard on the salesman. When the victim sets down his jewelry cases to clean up the mess, another gang member whisks by to grab them. In one incident, the Colombians diverted a salesman by staging a loud dispute over his airplane-seat number; when he landed in New York, he found that his display cases were no longer in the overhead luggage bin.

But increasingly the Colombians are using guns. Late last year four men jumped salesman Charlie Ryan in his own garage in Sunnyvale, Calif., and shoved a gun in his face; they got away with $750,000 worth of jewelry. "I swore that if they ever tried to rob me, it wasn't going to be easy," Ryan says. "But I was a puppy, forget it." Like everyone in the industry, Ryan is well aware that more and more jewelry workers are being killed in robbery attempts - 281 dead since 1984, according to the Jewelers' Security Alliance - although no one blames the Colombians for all 281 murders.

John Bagley, whose firm makes high-end jewelry in Santa Rosa, Calif., says the rising risk is shaking the industry. "When they face certain death if they make a wrong decision, you're going to lose key people," he says, citing the case of a woman sales manager who quit after a robbery attempt in Denver. Bagley's salesmen have been robbed four times for $2.3 million. "In one week, there were three huge robberies in Phoenix, one in Oregon, and in Tennessee they killed a police officer escorting a Rolex dealer," says Eddie Levian, president of A. Levian & Co. of New York. "Jewelers are in a war without the ammunition to fight. With all due respect to law enforcement, we do not feel safe."

Backed by cops in many big cities, the jewelry industry is looking to the FBI for help. "There has to be some coordinated effort, because this is an interstate crime by foreign nationals working in an organized fashion," says the jewelers' alliance's Kennedy. In fact, the FBI has been following the Colombians for years, through a program called COLGEM, and the bureau is well aware that big-time jewelry thefts by South American gangs are an escalating problem. "I can understand why they're [asking for help], and we're enhancing our efforts," says Steve Wiley, chief of the FBI's Violent Crime and Major Offenders Unit. That's encouraging, but Kennedy and others wonder how quickly the FBI can make a difference - for if the losses aren't stopped, some jewelry companies may not survive.

Gullible Americans Are Giving Their Privacy Away
AZ Daily Star, August 9, 1999
by Lisa S. Dean
Privacy advocates very often are asked by citizens from all across the nation what they intend to do to fight for their privacy. The answer usually comes in the form of revealing a grass-roots or legislative strategy, not because success was certain but because it seemed to be the logical way to proceed. Privacy advocates more often are beginning to see a very different picture, however. It's not what organizations and groups in Washington should be doing to protect citizens' privacy, it's what citizens themselves ought to be doing. So the question on the flip side of the coin ought to be, "What are you citizens doing to protect your privacy?"

The combined efforts of all the organizations in Washington haven't succeeded so far in protecting Americans' privacy because they haven't had the help of Americans themselves. An analogy that best illustrates the point is military generals planning a war, mapping out strategies and scenarios. Then, when they attempt to execute these strategies, they turn around to find no troops behind them, and for that reason, they fail.

The war to protect our privacy begins with each and every individual in America saying "no" when asked to give their Social Security number, or their thumbprint or told they have to register their gun or have their young children immunized with the deadly Hepatitis B vaccine.

When was the last time you were asked to give your Social Security number and you refused to do so? In all but a very few cases, you are not required by law to produce this number. Yet your Social Security number is being asked of you 10 times a week, by doctors, by grocers, by bankers, by travel agents and so on. Tell them "no". The more people who refuse to give out their Social Security number, the greater the chance of protecting your privacy.

People should at least make the effort initially to question why it is necessary that they give this information. If you don't want the government or private companies to know everything about you, here are a few other things to avoid. Don't use the discount card at your local grocery store. Sure, you save a certain percentage whenever you use it, but every time you use that card, the grocery store logs it as well as the items you bought into their database system. There are no laws, state or federal, that prohibit grocery stores from selling or sharing that information with anyone it chooses. So the databases build a profile of what you purchase and direct marketers can target you with their goods.

And the next time you park at an airport, note that your license plate is either on camera or is printed on the receipt the clerk hands you along with your change. Clerks are instructed to collect this information, allegedly to protect you in the event you lose your ticket and can't prove how long you've been there. Nice and convenient, but that information ends up in a database and can be given to law enforcement at their request. And when the airports ask for a photo ID, don't hand them one with your Social Security number on it. Get one made up, perhaps by a video rental place. Hand over that piece of identification.

The list goes on and on, from Social Security numbers to biometric identifiers such as your thumbprint or your retina scan, which more banks are requesting every day. Listen, friends. We aren't just having our privacy stolen from us. We are giving it away. And as long as we are compliant, we are going to continue to lose our freedom. Americans continue to say they are drawing a line in the sand with respect to their privacy. Really? That's questionable because it's not at all evident.

What is evident is the large number of very compliant, trusting people in this country who don't want to cause trouble or be inconvenienced and as a result, are having the wool pulled right over their eyes. Privacy advocates will continue to fight for privacy but for there to be any successes at all, it will take Americans to be there fighting right along with them. Otherwise the entire effort is a waste of time.


The information provided in this newsletter has been derived from research and sources believed to be reliable. However, no guarantee is expressed or implied as to their validity. Opinions included herein are subject to change without notice. The gem market is speculative and unregulated. Certification does not eliminate all risks associated with the grading of gems. Recommendations are meant for those who are financially suited for the risks involved. Past performance is not a guarantee of future performance. Neither NGC nor The Gemstone Forecaster guarantee a profit or that losses may not be incurred as a result of following its recommendations. They may also hold positions in areas they recommend. Subscribers should not view this publication as investment advice, nor is it intended as an offer or solicitation with respect to the purchase or sale of any security.
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