FTC: Just to be Clear, ‘Diamond’ Still Means Natural Diamond

Earlier this month, the Federal Trade Commission (FTC) issued warning letters to eight jewelers for promoting laboratory-grown diamonds in advertising that the agency claims might be deceptive or at the least, not in line with its own Jewelry Guide.

That particular code of federal regulations — formally known as the “Guides for the Jewelry, Precious Metals, and Pewter Industries,” describes what businesses must do to avoid making deceptive claims about precious metal, pewter, diamond, gemstone, and pearl products. The intent is to prevent unfair or deceptive trade practices; practices that almost always lead to unsuspecting consumers being ripped off or worse.

And while the FTC has determined that laboratory-grown diamonds
are real diamonds, the agency’s April 2, 2019 announcement said businesses must be crystal clear in their advertising that their product is man-made. In an article posted on here on the Custom Jewelry Blog last month (please see: Understanding Lab-grown Diamonds), we reported the FTC’s finding that lab- created diamonds share the same or similar chemical and physical properties as a natural diamond produced by geological processes.

In amending its jewelry guides at that time, the FTC determined that “a diamond is a diamond,” no matter its origin. However, earlier this month, the FTC felt it necessary to make it clear that when the word “diamond” appears by itself — particularly in advertising — it still means “natural diamond” (as in a mined diamond, taken from the earth).

Further, the agency said advertisements for man-made diamonds (i.e., lab-grown diamonds) must contain a “clear and conspicuous” disclosure, recommending the descriptive terms laboratory-grown, laboratory-created or (manufacturer’s-name) created. The FTC said the word “cultured” can also be used in such advertising, but it must be“immediately accompanied, with equal conspicuousness” by one of the aforementioned three terms.

In its warning letter to the eight companies in question, the FTC said it had concerns that some advertising — on the firms’ websites, Instagram, YouTube or Twitter accounts — implied jewelry fashioned with laboratory-grown diamonds were either mined or natural diamonds.

The FTC warning letters urges those eight businesses to review their advertising, make any necessary revisions, and tell the FTC what they’ve done to address the concerns. Specifically, the letter read, “The FTC staff is concerned that some of your advertising fails to conform to the Jewelry Guides and therefore may deceive consumers, in violation of Section 5 of the FTC Act.

“The Jewelry Guides caution marketers not to use the name of any precious stone, including diamonds, to describe a laboratory-created stone, unless such name is immediately preceded by a clear and conspicuous disclosure that the product is not a mined stone.”

Based on these eight letters, it is apparent that the federal government here in the United States is serious about misleading advertising or web-specific “news stories.” We here at Shmukler Design — creators and maintainers of the Custom Jewelry Blog — applaud the FTC’s most recent action. We believe the agency has consumers’ best interests fully in mind, and specifically those shoppers who might be in the market for a diamond and are interested in the more affordable option, but often indistinguishable lab-grown diamonds as we pointed out in our above-mentioned March 29 blog post.

If you have questions about laboratory-grown diamonds, consider giving our lead designer Boris a call.