Signet Refutes Allegations of Systematic Diamond Swapping

Akron, Ohio--Signet Jewelers is refuting reports of widespread “stone swapping”--switching out customers’ diamonds for moissanite or diamonds of lesser quality--at its Kay Jewelers stores.

In a statement issued after a BuzzFeed report generated a deluge of negative comments on social media, the country’s largest jeweler said it has vigorous product quality procedures in place that are consistently monitored. Its teams review the characteristics of the item with the customer both when they drop it off and when they pick it up following service or repair to ensure the safe return of their original piece.

Signet said it “strongly objects” to the allegations on social media, which have been “grossly amplified,” that its team members systematically mishandle customers’ jewelry repairs or swap out their diamonds. “Incidents of misconduct, which are exceedingly rare, are dealt with swiftly and appropriately,” the company added.

It also noted that its customer service team has not received an unusual number of complaints lately and that it manages more than 4 million service and repair transactions each year, with more than 99 percent completed without negative customer feedback.

Even so, the jeweler noted in a further statement to National Jeweler that it is “actively reviewing” the issues brought up by the BuzzFeed story and is evaluating its processes to see if there’s any way they can be improved.

Signet Jewelers, which operates Zales and Jared the Galleria of Jewelry as well as Kay, sent out its statement last week, a day after its stock price dropped when stone-swapping allegations as well as renewed criticisms about the size and quality of its credit portfolio was mentioned in James Grant’s investment newsletter.

As noted in its first quarter results released May 26, the company’s board of directors has authorized management to conduct a strategic evaluation of its credit portfolio and has hired Goldman Sachs to be its financial advisor in this process.

“Signet will consider a full range of options with respect to its credit operations and update investors as appropriate,” the company said.

The BuzzFeed story that ignited the social media firestorm ran on May 25 and detailed the experiences of a trio of women who claimed their diamonds were switched for moissanite or lesser-quality stones by employees at three different Kay stores.

More than a week later, the social media chatter has yet to die down, with the subject of diamond swapping dominating many posts on the Kay’s Facebook page.

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