Sunday, October 25, 2009

The Diamond Jewelry Industry & The Uniform Commercial Code - USA

The Diamond Jewelry Industry
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The Uniform Commercial Code - USA
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Have You Ever Signed a Consignment and Security Agreement from a Diamond Vendor?

A diamond vendor whom I’ve been doing business with for the past 2 years or so said his company has changed it’s policy and is requiring all retailers whom carry large quantities of diamonds on memo to sign a Consignment and Security Agreement. They are calling it a UCC form (Uniform Commercial Code).

Of course, I asked why enforce this policy. They started this when a retailer took much of their merchandise on memo, declared bankruptcy, and apparently the memo didn’t hold much weight and the company lost much of its merchandise.

I read the agreement backwards and forwards and it basically allows the diamond dealer every chance to take you to court if you lose the merchandise and don’t pay for it, sell a memo piece and don’t pay for it, if you go bankrupt they have the right to come in and collect their merchandise, etc.

Have you signed one? To diamond vendors out there…has this helped you in recent cases of stores closing or declaring bankruptcy?
Source : JCK Shanu Singh Guliani

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Additional Reading:

Australia's Diamond Ponzi Scheme

Diamonds: Undercutting Prices & Deceptive Websites

The Dumbest Way to Buy Diamonds

Diamond Drop Shippers

BEWARE Bogus Diamond Website Listings

Prostituting World Wide Web Diamonds

How to Buy Diamonds according to Diamond Imports

Comment:

" The extensive use of consignment transactions and providing of extended terms of credit in asset sales amounting to millions of dollars, many times without any security agreements, UCC security filings, or perfected secured collateral, is a unique and troubling element of the industry's trade practice. " : Attorney Leonard Weiner http://ucc4jewelers.com./

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Please Note
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