The diamond detectors: searching for truth

Synthetic diamonds have been one of the most controversial categories of the jewellery industry in decades. More so than any other simulant, lab-grown stones have called into question the intrinsic value of natural diamonds, as well as directly competing with lower quality and melee stones.

Synthetic diamonds have been available for decades, but their application in jewellery – as opposed to industrial use – seemed limited up until recently. With technological breakthroughs to create gem-quality stones and a significant marketing push, combined with lower pricing, it’s estimated that they represent about 2 to 3 per cent of the total diamond jewellery market today.

The debate around whether synthetics are innovative or disruptive – that is, if have they fundamentally changed the natural diamond market – continues, with various industry commentators believing the stones will either return to the industrial niche or maintain a significant segment in the jewellery category, albeit at the lower end of the price scale.

The controversy over nomenclature reflects the broader ambivalence of the industry in embracing lab-grown diamonds – as well as the need for clarity when it comes to retailing these stones.

At the CIBJO Congress ten years ago, the term ‘synthetic diamond’ was considered to be the most appropriate descriptor; yet manufacturers have continued to use alternatives such as ‘lab-grown’ or ‘created’ – which many in the industry have criticised as misleading to consumers, obscuring the factory origin of the crystals.

The Gemological Institute of America (GIA) uses both ‘synthetic’ and ‘laboratory-grown’; however, it does not grade synthetic diamonds on the same scale as natural stones, using general terms to describe the colour and clarity.

Significantly, the 6,000 members of the world’s largest online diamond trading platform, RapNet, voted in June this year to uphold the ban on synthetic diamond trading through the system. Synthetics are also banned at many of the world’s major diamond bourses.

"They [synthetic diamonds] should always be disclosed so that consumers know exactly what they are buying, and so that there is no confusion between real natural diamonds and lab-growns"

Ernie Blom, president of the World Federation of Diamond Bourses

However, many industry experts believe the ‘tipping point’ for the industry has already arrived. It is now almost a year since De Beers entered the synthetic diamond market with its Lightbox brand, pricing the stones at US$800 per carat – about 15 per cent of the value of natural diamonds.

In addition, De Beers’ prices its lab-grown stones on a linear model due to the lack of intrinsic or resale value.

The price differential between the two categories has widened. In March, the wholesale price for lab-grown stones fell 60 per cent, with De Beers’ CEO Bruce Cleaver calling the margins ‘unsustainable’.

Still, diamond industry analyst Paul Zimnisky has predicted the sector will enjoy an annual growth rate of 22 per cent to US$5.2 billion by 2023.

The consumer appeal for these stones is predicated on two factors. The first is cost, with purchasers able to buy a larger stone for less or colours like blue, pink and green at a fraction of the price natural fancy colour diamonds command.

The second factor is perceived ethical superiority. Earlier this year, the US Federal Trade Commission sent warning letters to eight high-profile synthetic diamond companies, warning them against using nebulous terms like ‘eco-friendly’, ‘sustainable’ and ‘eco-conscious’, as well as mandating ‘clear and conspicuous’ disclosure of lab-grown origin.

The rise of synthetic diamonds has coincided with a greater consumer push for transparency, traceability and sustainability – or at least, the appearance of it. Many synthetic diamond manufacturers have touted their environmental credentials, without informing consumers of their energy-intensive processes.

It has been noted that no conservation group has endorsed a synthetic diamond manufacturer, in similar ways as they have done with electric vehicles.

The challenge of undisclosed synthetics

However, there is one factor on which all sides of the diamond debate can agree: that natural and synthetic diamonds need to be differentiated.

Ernie Blom, president of the World Federation of Diamond Bourses, has said, “They [synthetic diamonds] should always be disclosed so that consumers know exactly what they are buying, and so that there is no confusion between real natural diamonds and lab-growns.”

Worryingly, the GIA has encountered synthetic diamonds mixed in packets with natural diamonds, as well as natural stones coated in a synthetic layer to increase their size or change their colour.

Closer to home, Bill Sechos, founder of Sydney’s Gem Studies Laboratory (GSL), says, “We are now getting, on a semi-regular basis, parcels of melee from importers and retailers that are submitted for routine testing to see if there are any questionable stones. In one particular instance, nine out of 10 parcels, each containing 10 sample stones, proved to have questionable diamonds in them.”

“In the last six months we have seen three larger stones – a 50-pointer, an 83-pointer and 1.10-carat – that were submitted for diamond grading reports that proved to be synthetic. In all three cases they were not disclosed as synthetic,” he adds.

“Fortunately, in two of the cases the diamonds were returned to suppliers overseas; but in the case of the 1.10-carat, it was bought second-hand and was not able to be returned.”

For many jewellers, diamond certification from the GIA, the European Gemological Laboratory or the Scientific Gemological Laboratory can help to establish the legitimacy of a stone, and preserve its value to the consumer.

However, the system isn’t foolproof; indeed, the World Federation of Diamond Bourses (WFDB) maintains a list of potentially compromised GIA certificates on its website.

Recently, the BBC reported that synthetic diamonds with falsified natural certification were being advertised on the Chinese online market Alibaba. As a result, the WFDB cautions traders from accepting diamonds with suspicious-looking paperwork or without a physical copy of the certificate.

“In one particular instance, nine out of 10 parcels [submitted to us for testing], each containing 10 sample stones, proved to have questionable diamonds in them”

Bill Sechos, founder Gem Studies Laboratory

Laser-carving a microscopic GIA serial number into the surface of a natural stone is another technique used to ensure integrity – however, this carving can be removed by polishing and/or another gem’s serial number applied.

British start-up Opsydia has developed a laser that can etch a security code inside a diamond so it can’t be tampered with.

Similarly, US company Scarselli Diamonds has recently filed patents for its DiamTek nano-laser tagging system, which would register each tagged diamond’s unique code in a secure blockchain.

But in both cases, the technology is not yet at scale; it simply won’t be applied to every single mined diamond as it is polished, nor to every single natural stone currently in the market.

Provenance measures like DeBeers’ GemFair and Tracr initiatives have also been adopted to stem the flow of synthetics being passed off as natural, as well as address consumer concerns about conflict diamonds. GemFair ensures point of origin by storing rough diamonds in sealed, tamper-proof bags at the mine, while Tracr uses blockchain ledger technology during the manufacturing process.

Yet the fact remains that jewellers may require more than certification to know if a diamond is genuinely natural. That’s where synthetic detectors come in.

Synthetic detectors collect different types of data, including visual and light clues, when examining diamonds to determine if they can either conclusively be considered natural or synthetic, or if they should be referred to a gemmologist.

“The best advice for jewellers – especially those in a position to buy second hand diamonds or importing directly from overseas – is to invest in a screener as a safeguard against making the wrong decision,” Sechos explains.

“All screeners reject stones that are suspect. These then have to be further tested to identify whether they are synthetic diamonds or not; if the screener refers the stone for further testing, it would be advisable to avoid it.”

The World Federation of Diamond Bourses takes a neutral stance on synthetic diamonds, with individual member bourses deciding if they will allow them – or not

Tell-tale signs of lab-grown diamonds

There are two methods to produce synthetic diamonds: high-pressure, high temperature (HPHT) and chemical vapour deposition (CVD). While chemically identical to natural diamonds, synthetics display a different growth structure. They are also used to produce the most rare types of diamonds: those with low nitrogen content, called Type II.

“The colourless synthetic diamonds in the marketplace are Type II, so it is becoming more and more important to have a screening device that can differentiate between Type I and Type II diamonds to protect against unknowingly buying a synthetic diamond,” Sechos explains.

Each method carries its own signatures of manufacturing, rather than Earth origin, ranging from the type – or lack of – inclusions to level of fluorescence under UV light, internal patterns, and colour zoning, among other traits. While diamond simulants such as synthetic moissanite, white sapphire and cubic zirconia can be identified with simple lab tests, a hand lens, and even with the naked eye, synthetic diamonds require sophisticated equipment to detect.

“There are no discernable differences to the naked eye or under magnification that the diamond being examined is a man-made one,” Sechos says. “Visible features and properties that can be investigated using normal diamond testers and loupe or microscope examination are not different from a natural diamond; there are no ‘red flags’ or warning signs which are immediately visible – instrumentation must be used.”

The crucial element in delivering peace of mind is empowering jewellers to detect synthetic diamonds, allowing them to decide for themselves how they will interact with this controversial category.

READ FULL REPORT

MEET DIAMOND DETECTOR SUPPLIER SPONSORS SERVICING AUSSIE JEWELLERS
Yehuda's Sherlock Holmes detects diamonds on the go			DRC Techno delivers diverse diamond detection solutions