Gem Scams in Thailand Buyer Beware!
By Li Ching Chia-Heng

(Article featured on Frontpage Q2)

Here is an article extracted from The Observer, UK (Sep 2002) that documents the experiences of some British tourists in Thailand . Buyer beware!

All That Glisters Is Not Gold...
by Rob Cole

The sting
It starts innocently enough. Having arrived in Bangkok , halfway through a six-month backpacking tour of Asia , my sister Jacky and I are eager to cram in as many sights and experiences as possible.

As we leave our hotel, a Tuk Tuk (motorbike taxi) driver pulls up alongside us and offers us a tour of Bangkok . The price is right so we jump in and head off to visit some temples. At the second or third temple, we get talking to a Thai man who tells us he is visiting his family in Bangkok . He tells us he is a lawyer living in Sydney and mentions an annual jewellery sale that occurs for one week in Bangkok . The sale is for Thai students studying abroad who can buy precious jewellery without paying a 195 per cent business tax and sell it abroad at a profit to help pay for their education. He says tourists are also allowed to take advantage of this week-long sale because the Thai government wants to encourage tourism. Thinking no more of this, we continue with our tour. The next temple we visit is the Marble Temple , home of the Lucky Buddha. As we approach the shrine a man signals to us to remove our shoes and walk over to the Buddha with him. After some kneeling and praying he begins his story. He's a businessman from Phuket who makes an annual trip to Bangkok to buy jewellery and resell it in Singapore , using the proceeds to fund his holiday.

This story strikes a chord with us. A little extra money would certainly help fund our travels. The Tuk Tuk driver offers to take us to the 'Thai Export Office', which also goes by the name of Marin Gems. The owner seems very professional. We ask him lots of questions and eventually decide on a sapphire pendant and earrings for 49,000 baht, about £670. I would like to check the internet to see if the sale is bona fide, but it is Friday afternoon and the last day of the sale. The time for action is now or never.

The alarm bells should start ringing when they tell me they want to be paid in gold instead of by credit card. But I figure it's not worthwhile for them to set up a facility to process consumer credit cards for a one-week sale when they act as a wholesaler for the rest of the year. And anyway, I'm already dreaming of the 100 per cent return I'm going to make on my little investment. My plan is to send the jewellery to my sister in London , complete with certificates of authenticity, for her to sell to a good Bond Street jeweller.

With the sale complete, we are taken on a sightseeing tour of a town four hours away (later I realise, to keep us from doing any research and discovering we've been scammed).

Next morning I wake after a night of troubled sleep feeling very uneasy. I go to an internet cafe to find out more about the sale. I ask the woman operating the cafe if she knows about it. She doesn't, but an Australian working at one of the terminals pipes up: 'Don't do it, it's a scam.' He'd been relieved of £2,000 the day before in a similar fashion. Apparently the jewellery is probably genuine, but the craftsmanship and quality of the pieces is sub-standard and they are not worth half as much as I paid for them. Funny how things look in the cold light of day.

The fight for justice
Apparently this scam is very common. My Australian buddy is optimistic that I'll be able to recoup the bulk of my losses. All I have to do is take the jewels to the tourist police and they will help me negotiate a refund from the jeweller. Simple. Though I'm about to find out that nothing in Thailand is simple.

At the police station I bump into another tourist, Paul, who had been swindled by a different shop three weeks previously. He tells me the scam has been operating for more than 20 years in much the same way. He has set up a support group (see below) to help victims. I also learn that Marin Gems has shut down and reopened as Vandee Gems.

Eventually I am seen by a police officer. He asks me where I bought my jewels. I tell him Marin Gems. He responds, 'Marin closed', then stares at me as if that's enough to prompt me to turn tail and fly back to wherever I came from. I inform him that I know Marin has re-opened as a new operation (but neglect to say the name of the new store).

At this, he walks off to look into something. I wait another 20 minutes or so and finally intercept him again. 'Okay, man, come in one hour, undercover man, you go with him to Vandee Gems to try find people who sold you jewels.' Odd, because I never told him the name of the new store. Obviously the Marin/Vandee connection is well known.

Eventually the undercover man shows up and I and about five Thai police pile into a van and head down to the shop. We pass Vandee and keep driving. Then we stop in an alley. The whole time, the cops are nattering in Thai on their mobile phones (I later learn that this was to call ahead to the store to let them know we were coming).

We arrive at Vandee to find the staff waiting for us at the door. They usher us in and allow us to look around. The store is identical to Marin (even down to the fish tanks). I ask to go upstairs. I know this is where the scam takes place. Despite the words 'Whole sale Upstairs' written on the landing, they insist that upstairs is only used for storage. The police inform me that we cannot go up without a warrant. Fortunately there is a mirror on the landing of the stairs. In the reflection I see the same woman who was working at Marin during my fateful visit. I inform the police of this, but they say we must leave.

That night I meet up with Paul and some other victims of the scam. There are about 20 of us in all. Paul has managed to get an appointment for us to see the head of the national tourist police. It takes two hours by boat, bus and taxi to reach the tourist police central office only to be told that we are wasting our time. They end up simply corralling us all into police vans and sending us back up to the tourist police office in Bangkok .

I notice that we are being tailed on our boat cruise by a series of shady-looking men. I get pictures of most of them, which finally prompts them to give up the chase. I am starting to see just how deep this thing goes.

Undeterred, Paul manages to get a meeting with the Minister of Tourism at the National Assembly. We arrive at the parliament building at 9 am and at 11.30 am we are ushered into the boardroom. Around the table are seated about 35 Thai men whose sole function seems to be mumbling to each other, smiling and shuffling papers.

Paul addresses the group, but no one is listening. Even the Minister chats away to one of his subordinates as Paul presents our case. Suddenly the door opens, and the press (five cameras in all and various reporters) stream in though the door. The Minister gives a 10-minute speech in Thai. No translation is provided. The meeting is over and we leave not really knowing what happened.

Several pointless visits to the tourist police later, I finally manage to squeeze out of the police officer that the only thing I can do is to prove that the two stores are the same by either identifying an employee of both stores or proving that the ownership is the same.

The counter-attack
We are on our own. Nobody is interested in helping us. Paul introduces me to Andy and Travers, two Britons who were scammed by the same store. They have some video footage of their first visit to Marin Gems. Together we come up with a plan of action: to smuggle a camera into Vandee and get some conclusive photographic evidence to prove that they are one and the same operation.

Travers rigs up a concealed camera and microphone hooked up to a mini-disc player in his bag. Putting on dark glasses and a baseball cap, he goes to Vandee Gems and gets the shot we need of one of the employees already captured on film in Marin. Now it's time to present our evidence to our friends at the gem store and, if necessary, take it to the police. But first we must find a Tuk Tuk and initiate the whole scam process to prove it's the same set up.

We are lucky enough to be picked up right outside our hotel. A Tuk Tuk driver (who I recognise from a photo provided by a fellow victim of Marin Gems) pulls up and offers us a tour of Bangkok for 10 baht a head. We set off but I realise that in my haste, I've left my jewellery in my hotel room. So I pretend I've forgotten my camera film and we drive back to the hotel to pick it up.

I find the package where my receipt, certificate and jewellery are. Only problem is, my jewellery has gone. After a frenzied romp around the room throwing everything all over the place I realise that it really has gone. I am not sure how it was stolen - perhaps at the tourist police, perhaps at the hotel. I am on the verge of going completely insane.I pull myself together. The show must go on. If only for the sake of my two English friends who have lost about £6,500 between them.

So we head out to the 'Lucky Buddha'. Actually, it is only one of about 20 'Lucky Buddhas' at minor temples that the gem shops use as places to spring the scam. We approach the Buddha, and sure enough, along comes a well-dressed businessman from Phuket - same guy, same shirt, same line used on me a month ago. He sends us off to Vandee Gems.

We present our case to them and explain that we are happy to negotiate. The shopkeeper explains that his boss is away and that we should go to the police. He tells us that he has a right to protect his business. Behind him, all in black, stand three guys who look like they are the means of this protection. On the way out, we notice that the fish tanks are empty. Looks like they're on the move again. So we go to the tourist police, show our evidence and demand the help of an officer to go to make an arrest at the gem shop. Eventually, a young policeman who has been reading the newspaper comes over and starts yelling at me. He is annoyed that we have ruined an otherwise quiet and pleasant day, but he is probably most annoyed because if he helps us, a corrupt superior will have his head on a plate.

The end of the road
I am at the end of my tether and spend my time concocting murderous fantasies. Travers and Andy, however, use their day a little more productively: they take our evidence to a man at the Ministry of Internal Trade. He sends them to the Royal Thai police who send them to Interpol, where, finally, a woman seems very eager to help with our case. She asks for all of our evidence on disk and for a report of our entire experience. At last we are getting somewhere. But the next time Travers and Andy contact Interpol, they learn that their woman has fallen mysteriously ill and will not be back at the office for some time. They tell us to go to the tourist police.

At the police station, Andy presents the case to the officer in charge, who promptly leaves the office. There are about 20 staff milling about watching TV, reading newspapers, chatting or taking a nap. Two tourists sit at the help desk waiting for service. No one is helping them. An elderly British couple walk into the office. They were scammed by Vandee Gems six days previously. They have their gems and are awaiting a negotiator who is supposed to arrive at 4 pm .

At 4 pm , they go to speak with an officer. He calls the shop, hangs up and reports: 'Vandee closed.' This time, I feel defeated once and for all. I have no patience, no jewels and I am heading home in two months. I just can't allow this to keep wrecking my trip.

That night, as I am walking down the street, I run into a couple of members of our group. Our numbers have been dwindling over the last few days. Most people have either gone home or moved on. Everybody has hit the same brick walls. The scammers and their protectors have been running this racket for 20 years. They have seen everything. All bases are covered. Some people get some money back, but most are ping-ponged between various corrupt authorities and well-protected gem-stores until they are frustrated into submission. In the end we all leave, and the next crop of foreigners walks into the snare to be spat out into the bewildering sea of frustration until they too turn tail and run.

One of the guys I meet is Rainer, a German, who has been pursuing his case with lawyers for over a month. He has hit every obstacle. He has been followed, he has been beaten up outside the gem shop while the tourist police watched from across the street and someone broke into his room stealing his bag, his passport, his jewels, his ticket home and his credit card. He is going home bitter and defeated. I've bought my ticket to Kathmandu . I can't let this thing ruin my trip any longer. This is just the way Thailand is. Take it or leave it.

I came here to experience and learn about new cultures. The only thing I've learnt is just how corrupt a country can be when you scratch beneath the surface. Perhaps this is a valuable life lesson, but certainly not one I expected to learn when I arrived in 'Amazing Thailand'.

The support group
The Thai Gem Scam Group was set up by scam victims Paul Gillis and Sundeet Mukherji earlier this year. In the four months since their website went online they have taken up the cases of 131 people who lost on average $2,610 (£1,690) each, and have got a partial refund for 28 of them. Paul says: 'If you have got the gems and the shop is still open you stand a good chance of getting 70 per cent back. Otherwise you're stuffed.' The group estimates that 15,000 people per year fall for the scam.

The victims
Alexandra Standen spent 144,000 baht (£2,210) on three different diamond and sapphire sets in 2000, she reported that the tourist police did not offer any support. 'They talked about us in Thai to the men from the gem shop and laughed at us. [I've] encountered many other tourists who have been tricked in this way... some of whom have returned to the shop for a refund, and have been treated in a very threatening way.' Paul Murphy paid out 192,000 baht (£2,950): 'The police did not care or do anything about the matter.

A member of the TAT [Tourism Authority of Thailand] staff walked out of the police station and kicked a cabinet and said that the whole place was so dirty he would have to leave.

We spoke to people whose lives were threatened, and a Japanese girl who was assaulted at the store, and nothing was done by the police.'

The response
Chris Lee, head of marketing, Tourism Authority of Thailand in London , said: "Ninety-nine per cent of the complaints we receive are from tourists who have been ripped off by gem scams. It is a serious problem and the Thai government treats it very seriously, which is why the Jewel Fest Club campaign was launched. If tourists want to buy any jewellery they should look for the Jewel Fest Club sign in jewellers which denotes that the jewels are checked for quality and means tourists can get their money back if they are not happy with their purchase. The majority of Thais are very honest and nice people, but tourists must remember to put their common sense hat on when they go shopping."