« Mind-Body Expert Chopra to Address GIA. | Main | Gold on The March! Extends Rally! »
GIA Installs Destino as Chief: Announces Major Changes to Lab.
The Gemological Institute of America (GIA) has announced sweeping changes in the face of the New York lab grading scandal that has rocked the organization.
Ralph Destino, former chairman and president of Cartier, Inc., has been appointed chairman of GIA, a newly created position, it was announced Monday by GIA's Board of Governors. The position is effective immediately. Current GIA president Bill Boyajian will remain with the organization as president, but he will report to Destino, according to a GIA release.
"Following a three-day board meeting, it was determined that Mr. Destino, a longtime Governor of GIA, is uniquely qualified to assume leadership," the Board of Governors said in the release. "He has our deepest respect and our fullest confidence. We believe that this appointment, as well as the new initiatives we are implementing, should signal to the diamond trade, in the strongest terms, the seriousness and depth of commitment the board has with regard to ensuring that the industry can place its trust in GIA as the standard for diamond grading, worldwide. "
The news follows GIA's Oct. 18 announcement that it had fired four of the 242 employees at its New York gemological laboratory and that lab head Thomas C. Yonelunas had resigned—though he was not implicated—amid an independent review into grading improprieties at the lab. The review was prompted by a lawsuit accusing the GIA lab of upgrading diamond grading reports in exchange for money.
In addition to Destino's appointment, GIA also announced the following changes:
* The GIA lab will discontinue its current "Membership" structure and will introduce a new single price structure for all diamantaire clients, worldwide. This policy will go into effect Jan. 1, 2006. Further details will be forthcoming.
* To avoid any appearance of impropriety, GIA will, effective immediately, no longer solicit or accept donations from diamantaires whose stones are graded in the lab.
* Following the recent independent investigation mandated by the Board of Governors, the names of those diamond dealers who may have violated GIA's Code of Ethics have been turned over to law enforcement officials. GIA notified these dealers that it will no longer accept diamonds from them for grading.
"I am honored to take on this active management role and pledge to work tirelessly with the Board of Governors, as well as partnering closely with Bill Boyajian, to instill a new culture at GIA," Destino said in GIA's release.
In the statement, Destino stressed, "If we are to continue to earn the trust of diamond dealers, other trades people and the public, we must maintain the very highest ethical standards and a zero tolerance policy that are beyond reproach. These initiatives are just three of the many new policies and practices that we plan to announce in the coming weeks and months that we believe will be embraced by the industry. The Board of Governors, as we have recently promised, has formed a special Operations Committee to address other important policy issues that will lead to additional initiatives."
The news comes on the heels of GIA appointing Linda Scholl to the new post of lab compliance officer. Scholl will oversee the enforcement of GIA's compliance policies for the laboratory.
A special letter was mailed to all GIA clients on Nov. 15, from recently appointed New York lab head Tom Moses, who wrote:
* All GIA employees must avoid situations that conflict in any way with GIA's ability to serve its clients. Therefore, no employee may solicit or receive compensation in any form from lab clients, including cash and/or non-cash gifts or entertainment. There is no exception to this rule and any violations will result in immediate dismissal.
* GIA has retained EthicsPoint, the leading provider of services to support compliance, workplace ethics and corporate governance, to enable GIA clients, as well as GIA employees, students and vendors, to communicate openly, anonymously and safely with GIA management and its board. A 24-hour, 7 day-a-week hotline has been established for this purpose. The number is: (866) 295-2625 (toll-free in the U.S. and Canada) and will begin operation on Nov 21. [Also beginning Nov. 21 outside of the United States. and Canada, one may contact a local operator to place a collect call to the following U.S. phone number: (503) 726-2269 (only an operator can place the collect call). The multilingual Web site is also available for reporting: Ethicspoint.com]
* GIA has taken steps to strengthen its Professional Ethics and Conduct Compliance Statement. Among its new principles and policies, is the requirement for employees to inform GIA senior management of any code of conduct violations that they may witness or of which they become aware. Failure to do so will result in dismissal.
"These first steps are just the beginning of a new culture that is shaping at GIA," Destino said in the release. "We take this matter very seriously, and we expect both our employees and clients to do so as well."
