The Jewelers Vigilance Committee (which you should all belong to so
you get these updates yourself instead of having to wait until
someone like me posts it on Orchid–not to mention that it supports
the entire jewelry industry) has just posted the rules based on the
USA Patriot Act. Based on my reading of what they are saying it is
unlikely that most of you have to do anything. Retailers appear to
be exempt as long as they don’t make major purchases (over $50k per
year) from any foreign gem or jewelry dealers (US dealers have to
comply with the act) or any major purchases from your customers.
Gem dealers, on the other hand, might want to look into this a
What follows is part of the transcript of the JVC email I just
received (hopefully I’m not violating any copyright here) and the
JVC does offer the opportunity to purchase a compliance kit. You
should contact the JVC directly if you want the kit.
JANUARY 1, 2006 IS COMPLIANCE DEADLINE
The US Treasury Department has issued the final rules
requiring "dealers" in precious metals, jewels and stones to
institute anti-money laundering (AML) programs. YOU MUST
COMPLY BY JANUARY 1, 2006.
According to the final rules, you must institute an AML
1. You are a dealer, meaning, you purchased "covered
goods" (precious metal, jewels and stones) in an amount in
excess of $50,000 during the prior calendar or tax year AND
received more than $50,000 in gross proceeds from the sale of
precious metal, jewels or stones during the same period.
2. The calculation of the value threshold for purchase
and sale is limited to the value of the precious metal, jewels
and stones ONLY!
IMPORTANT EXCEPTIONS FOR RETAILERS - READ THIS!!!!!
According to the final rules, retailers (those selling
primarily to the public) may not need to implement an AML
program if you qualify for one of the following exceptions:
1. If you are a retailer, and purchase only from other
dealers (as defined above) who implement a U.S. AML program,
you do not need to comply.
2. If you do purchase from non-dealers, such as members
of the public and foreign sources of supply (to whom the US
rules do not apply), and the value of the covered goods is
less than $50,000, you do not need to comply. If the value of
the covered goods is more than $50,000 in any one calendar or
tax year, you must comply.
3. If you are a licensed pawn broker (rules for pawn
brokers will be published by Treasury at a later date).
Retailers: For the purpose of determining your exception
status you need not include in your calculation purchases in
the form of trade ins, as long as they did not include
providing funds of any kind to the customer in exchange for
trade ins of such covered goods.
Daniel R. Spirer, G.G.
Daniel R. Spirer Jewelers, LLC
1780 Massachusetts Ave.
Cambridge, MA 02140