Major US and international diamond jewelry retailers are not fulfilling promises to fight trade in conflict diamonds, says a hard-hitting report by human rights group Global Witness released today (Tuesday) at the World Diamond Council annual meeting in Dubai.

The report, Broken Vows: Exposing the “Loupe” Holes in the Diamond Industry’s Efforts to Prevent the Trade in Conflict Diamonds, attacks major retailers and industry organizations for not taking strong enough measures to fight the trade in conflict diamonds.

 

The report shows that the largest members of the US diamond jewelry retail sector, which accounts for more than half of diamond jewelry retail sales worldwide, are not carrying out even the basic self-regulation actions aimed at stopping trade in conflict diamonds.

 

The self-regulation requires all sectors of the diamond industry to put into action a system of guarantees and a code of conduct to keep conflict diamonds out of legitimate trade and to support the Kimberley Process.

 

Diamond companies have also committed to educating employees about self-regulation so that consumers can be given assurances that diamonds are conflict free.

“Diamond jewelry retailers are the industry’s public face and they have a special responsibility to tackle conflict diamonds by complying with the self-regulation and by actively promoting compliance by their suppliers,” says Corinna Gilfillan of Global Witness.

 

“But some of the largest US and international retailers are paying only lip-service. This continued failure means that diamonds can continue to fuel conflict, human rights abuses and terrorism. It is even more disturbing given that the industry will soon be required to implement anti-money laundering regulations under the US Patriot Act to help combat terrorist financing,” the report said.

Out of 30 retailers surveyed by Global Witness across the US, including international luxury jewelry companies, national department stores, national jewelry chains and independent stores, only in four stores salespeople were well informed about their company’s policy and the system of warranties.

 

In general, employees showed a low level of awareness about company policies on conflict diamonds. Global Witness said this illustrated the failure of retailers to carry out a fundamental condition of the self-regulation policy.

 

Meanwhile, 25 out of 30 companies have failed to respond to Global Witness in writing about their policies on conflict diamonds and self-regulation.

 

They include international luxury jewelry companies such as Bulgari, Cartier, Harry Winston, Van Cleef & Arpels and Wempe, US jewelry chains such as Littman Jewelers and Whitehall Jewelers and US department stores including Federated Department Stores, Inc (the parent company of Bloomingdale’s and Macy’s), and Saks Fifth Avenue, Global Witness said.

 

All five companies that responded are implementing the system of warranties. These included Tiffany, the Signet Group, Zale Corp, Fortunoff and Pampillonia.

 

Tiffany stood out, the report said, because the jeweler described how it has strengthened its policies on sourcing and auditing to help ensure that it is not dealing in conflict diamonds.

The report also accuses the World Diamond Council, which is responsible for coordinating the industry’s efforts to combat conflict diamonds, and other trade associations of not adequately monitoring compliance with self-regulation.

 

Global Witness is calling on the World Diamond Council and other major industry bodies to develop a common standard for checking on compliance with self-regulation and to push for its adoption across the diamond industry.

 

It is also urging governments taking part in the Kimberley Process to directly regulate the diamond industry’s compliance with self-regulation.