This should be the best season for jewelers as June remains one of the most popular months for weddings. Signet Jewelers, owner of some of the most popular jewelry-store brands in the United States, however, is having a nightmare.
The owner of Kay Jewelers, Zales and Jared is currently facing controversy following reports and social media allegations that some of its employees have replaced premium diamonds that customers have already purchased with cheaper, man-made stones during scheduled maintenance and cleaning.
The issue started when BuzzFeed published an article about Chrissy Clarius from Maryland. Clarius claimed that the diamond engagement ring that her husband had bought at a Kay Jewelers store had its stone swapped for a lower-quality and man-made substitute when it was sent for checkup and repair.
Clarius, who believed that her ring's original diamond was swapped during repair, asked other jewelers to certify the stone after noticing odd things about her jewelry.
She was told that it was not a diamond but a moissanite, a stone that looks very much like diamond but is much more affordable.
"It was discovered that it was moissanite and not a diamond, and set [in] platinum, not white gold," Clarius related. "I felt sick to my stomach."
Other women claimed a similar experience of Kay replacing the original stone in their jewelry.
Signet denied the allegations, saying that its staff review an item's characteristics with customers once it is dropped off for service or repair, and again when it is picked up to ensure the safe return of the original piece.
"We strongly object to recent allegations on social media, republished and grossly amplified, that our team members systematically mishandle customers' jewelry repairs or engage in 'diamond swapping,'" Signet said in a statement. "Incidents of misconduct, which are exceedingly rare, are dealt with swiftly and appropriately."
The company dealt with another blow on June 2 as it saw a significant decline in shares following the release of James Grant's investment newsletter, which cited the news about the alleged swapping of premium diamonds for man-made replacements.
The report also raised questions on the creditworthiness of Signet's customers. The jewelry company provides financing for the purchases that its customers make.