Last week, it was reported that India was set to become the first country in the world where polished diamonds can traded on a commodity exchange.
The Indian Commodity Exchange Ltd (ICEX), which has already received the in-principle approval from the regulatory body for the launch of diamond contracts, is reportedly in the final stages of launching contracts that will allow trading in the precious stones with a formal launch by the Securities and Exchange Board of India (SEBI) expected by March.
However, in spite of their dazzling appeal, diamonds have come under scrutiny in France by the Autorité des Marchés Financiers (AMF) which has warned the public against offers in their investment.
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Diamonds are often presented as a safe haven, with promises of exceptional and even unrealistic returns, but the AMF is calling on individuals to be vigilant.
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The warning has arisen after the AMF noted a sharp increase in offerings of investment diamonds to the French public and received a number of complaints of aggressive solicitation from these platforms, along with difficulties experienced in recovering investments.
It was further noted that the postal addresses of these platforms or companies in prestigious places are often fictitious, in a similar way to illegal forex and binary options trading platforms.
The AMF has warned that due to the high degree of uncertainty as to the nature of such offers, investors should refrain from acting on the solicitations of these entities and should not relay them to third parties in any form whatsoever.
The AMF has also taken the opportunity to remind investors that these investment offers are risky, and in case of fraud they should file a complaint providing the judicial authorities with all possible information.