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Articles from DIAMOND JEWELLERY (984 Articles)

Diamond Exchange on brink of liquidation

The administrators of Diamond Exchange have confirmed that the online retailer has ceased trading, yet Jeweller has found it is still possible to order diamonds from the site.
Despite appointing bankruptcy and liquidation specialist Worrells as administrator on October 27, Diamond Exchange’s website does not notify customers of the company’s plight. 

In fact, it’s even still possible to choose a diamond and order it – without paying – on the Diamond Exchange site. In addition, and even though the company has been in administration for nearly a week there is no mention of it on the “Company Announcement” page of the website. 

The company’s “About Us” page details the fact Diamond Exchange is a public company and, “Diamond Exchange Ltd. is a member of the Jewellers Association of Australia (JAA) and is bound by their stringent prescribed standards and code of ethics,” however there is no overt detail that it’s in administration, though a new link, View details at A.S.I.C., has been added.

Although the link directs users to the ASIC record which states; “**Under external administration and/or controller appointed”, members of the public may not be aware of the ramifications of such matters. 

Worrells administrator Con Kokkinos told Jeweller that the first creditor’s meeting is scheduled for November 5 – the same day that Diamond Exchange is due to appear in the Victorian Supreme Court to defend itself against the wind-up application brought against it by creditor Morgan Trusscolt Capital (MTC).

Kokkinos added that the next step was for the administrators to submit a report to creditors, outlining the financial position of Diamond Exchange. This report – which Kokkinos estimated will take about three weeks to complete – will include any proposal that the directors of the company are prepared to submit in relation to settling their debts.

“This proposal will then be compared with a liquidation scenario,” he explained.

However, Kokkinos added that if the court hearing rules in favour of MTC’s wind-up application, Diamond Exchange could be put into liquidation before the administrators’ report is completed.

Timothy Stanford of MTC is claiming an amount of $235,923.38 from Diamond Exchange relating to a loan agreement entered into in October 2009.

The November 5 court hearing comes after the initial hearing on October 13 was adjourned, in order to allow Diamond Exchange time to decide if it wants to dispute the debt in question and also advise the court if it can file evidence of the company’s solvency.

Diamond Exchange continued to trade between October 13 and 27, when it entered administration.

UPDATE: Wednesday, November 3
The JAA's board took the decision to strip Diamond Exchange of its JAA membership and endorsement yesterday, after dealing with more than 50 consumer complaints about the company in two months.

"We have take action to expel Diamond Exchange Ltd after receiving and investigating more than 50 complaints over the last few months," said JAA chief executive Ian Hadassin. "This is clearly unacceptable behaviour."

More reading:
Diamond Exchange enters administration
Diamond Exchange still holding refunds
Diamond Exchange case adjourned
Diamond Exchange director sets up new company
Diamond Exchange poised for court
'Never buy diamonds online', urge stung customers
Australian Securities & Investments Commission
Diamond Exchange woes continue
Diamond Exchange stops trading
Diamond Exchange to be wound up?

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