Racism\Xenophobia, the Patriot Act and Trust February 2006
While we were in Tucson, I thought about the type of people from whom we purchase our gemstones every year. I was inclined to reflect on them as a result of the new Patriot Act provisions effecting our industry. Due to a new law within the Patriot Act, jewelers are required to adhere to an Anti-Money Laundering statute. I was a little bit confused about the need for a new law since RICO and other existing laws have been successfully used in the past to weed out Columbian drug cartel money and other gang and mafia activities.
Unfortunately, the government rarely uses common sense and the jewelry industry lobbyists must be as incompetent as a big game hunter looking for a target in Ohio. As a result of one or both, we now have to maintain an Anti-Money Laundering Policy(AML) with a copy of the policy on our premises. I am the official AML Compliance Officer--yah hoo! Now the Qaeda cannot infiltrate our organization and launder money through us. If we choose to be non-compliant we can suffer fines from $10,000 to $250,000.
Now, I do not mean to diminish the threat to our country at the hands of terrorists, but why penalize the jewelers? What about big oil or other companies and industries that actually operate in countries known as terrorist hot-spots?
In Tucson, Peter and I renewed our acquaintances with our gem suppliers, as we do every year. I thought about each of them in terms of the AML and it just seemed so absurd that I had to insure that they are not terrorists. Not only are our gem dealers nice people, they are at this point good friends. I would even go so far as to say that I consider some of them extended family.
I told our premier diamond cutter that he has made me a slave to his prices. Every year I go to Tucson and give him my list of needs and then I needlessly compare his prices with all of the suppliers at the many shows. It is a waste of time! His prices are so low that I can offer diamonds to our clients at retail for what other wholesale dealers are offering at wholesale. Not only that, he and his wife are kind, funny, intelligent, and interesting people with whom we visit every day of the show. Peter and I don't need to go to their booth everyday, it is a treat, a breath of fresh air and a break in a long, bleary week of searching through piles of junk to find treasures.
Our premier diamond supplier is also foreign-born. And that makes no difference to us, but now as a result of the AML we have to document all kinds of details about our transactions and their company. It smacks of xenophobia to me and it is offensive. Nearly all of the gem dealers with whom we deal are foreign-born. In the jewelry industry, racism and xenophobia is an impossibility. Gems come from every country and we deal with people from nations all over the world. It is a bonus to me, as I am endlessly curious about things, people and places.
The simple fact of the jewelry industry is that your company and\or personal credit rating means nothing. Gem suppliers know that if a jeweler is slow in paying, reporting them to the industry credit company will not help them get their money. In fact, if a supplier destroys a jewelers' credit rating, they can't do business and it is even less likely that the supplier will get their money. As a result, the jewelry industry is built entirely on integrity and trust. Do I trust you to pay for the $3,000 gem I just let you take from my booth?..is the question that gem dealers must ask themselves at every show.
As a gem buyer, Peter and I have to trust that our cutters and dealers are doing everything in their power to insure the gems are the quality they represent them to be. We regularly test the gems we purchase, but we purchase gems at the show before we have the opportunity to take them home to our lab in our shop and test them. If the gems turn out to be synthetic, we can always return them, but we have lost the opportunity to find other gems at the Tucson Gem Show which is an annual event. That type of loss would cost us hundreds of thousands of dollars.
On both the supplier and the buyer side in jewelry, trust is a commodity literally worth more than diamonds or gold. Our our industry is not one that is easily infiltrated by al Qaeda. Everyone recognizes everyone else and you work based on your gut feelings as much as your technical knowledge. A gem supplier who carries inexpensive gems that I occasionally buy for fashion designs was so worried about the Patriot Act that he made an appointment with his attorney while he was in Tucson to go over all of the operational details the day of his return from the show. That type of fear is a shame and if you ask me, it is not American.
If a number of terrorists had been discovered within the jewelry industry I could understand the extreme measures, but I have yet to find anyone within the industry who has even an anecdotal story about a terrorist within the industry. If the truth be told, jewelers buy and sell beautiful things that are romanticized and sentimentalized by their clients and the jewelers themselves. If you don't believe me, just ask your jeweler to see their private collection and listen to the stories about their pieces. At the end of the day of a Gem Show, jewelers and gem dealers can be found in the local restaurants or the hotel bar having a cocktail, not in some dark alley passing cash to a shady character with bad intentions. Jewelers are people who revel in beauty, not violence.
Now if we could all just get together and focus long enough to find some decent lobbyists, maybe we could be recognized as the artists we really are!