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Beware of the Thai Gem Scam

  • chopin

    Joined Travelfish
    28th April, 2007
    Posts: 154
    Total reviews: 2

    Copied and pasted from:
    http://2bangkok.com/2bangkok/Scams/Sapphire.shtml

    The Scam
    One of the most pervasive scams in Thailand is the Thai gem scam. Typically, a tourist meets a friendly Thai at a tourist attraction who eventually offers to take them to a "government" gem stone shop where the tourist is told about how they can sell Thai "blue sapphires" or other gems back home and make a 100% profit. It is all lies, of course, and the tourist ends up with a pocket full of overpriced gems. Like Thais themselves, the scam is low-key and the touts are friendly rather than pushy. A rule of thumb for Thais is that "real" Thais do not just walk up to strangers and strike up a friendly conversation. Thais typically "speak when spoken to." If you are approached at a tourist attraction by a friendly fellow who just walks up and starts speaking to you, watch out!

    Too many otherwise wonderful vacations have been ruined by this scam, so watch out. 2B has followed this scam online for nearly 5 five years and make no mistake--the authorities have done little to stop it. No official ever dares mention the "protected" gold shops that actually run the scams (UPDATE: Gold stores were finally mentioned in a Tourist Police brochure circa January, 2004). One of the tuk tuk drivers who takes victims to be scammed operates in front of the Tourist Information Centre and the local Police Station on Khao Sarn Road.

    The funny thing is that over the years the reports are from the same locations--only the names of the stores change. Officials claim that just changing the name of the shop prevents them from doing anything to stop the scam. See our Family Tree of Corrupt Shops. As one shop owner bragged to some cheated tourists: "I'll reopen again, just like I have for 20 years!"

    How it is done

    This is a by-the-numbers scam. Most people have the exact same experience. It usually goes something like this:
    1. You are riding in a tuk-tuk
    2. The driver tells you that wherever you are going is closed for some reason.
    3. The driver tells you he is specially trained to be helpful to tourists.
    4. You are told the government has launched a promotion to sell gems to tourists.
    5. In the course of riding around with the "friendly" tuk-tuk driver, you "accidentally" meet a well-dressed young man or an older, distinguished man.
    6. The younger man claims he is a student. The older will claim he works for the government and shows you his government ID. (Thai IDs mean nothing. They are readily available for a small fee to anyone.)
    7. The person you meet independently confirms the story the tuk-tuk driver told. (This is a nice touch.)
    8. Eventually you ask to be taken to the "government" jewelry house and are told that you can make 100-150% profit by reselling the gems back home. It seems okay since the seller writes something like "if everything is not ok we will offer a full refund" and puts an official looking stamp on it.
    9. You've now been cheated by one of the oldest and most openly practiced scams in Thailand.

    ------------------------------------------------

    Latest scam from Yindee - March 26, 2007
    A reader reports: Unfortunately I fell victim to the scam too.
    I want everyone in my country to know so hence I sent the below article to all the papers. They said they are going to publish it. Additionally I have sent a copy to the ministry of foreign affairs of Thailand and my country as well.
    Here’s what I wrote:
    I have just returned from a trip to Bangkok and would like to highlight that scams are still rampant in the city. In particular, gem scams. A quick check on the internet showed that these scams dated as far back as the 1950s and today, it is still very much alive.
    A typical scam begins when a tourist visits a shopping mall, especially Central World. There is a 4-face Buddha located outside the building in front of Isetan. A local will then approach the tourist. He may pass off himself as the inspector of the statues or as a professional such as a lawyer. He’ll then tell you that you should visit the lucky Buddha temple as it is only open once a month. If the tourist is agreeable, he will call for a tuktuk to send the tourist to the temple and back for just 40 baht. He will then inform the tourist that gem stones in Thailand carry great value and that a wholesale shop is opened to the public and is offering a 30% discount. He will encourage the tourist to visit the mining after praying at the lucky temple for it is not often that the wholesaler opens his shop to the public and great bargains await the buyer. Furthermore, he will add that local retailers such as Lee Hwa purchase their stones from them and that the stones will fetch high prices back home over time. With his convincing ways, there is a high chance that tourists who are not familiar with precious stones and the country may be enticed by the deal. The tuktuk driver will take the tourist to the temple and while in the premises, another person will come along and speak to you in Thai. He will appear to be surprised that you are not Thai and chat with you for a while on his background before talking about the gem wholesalers. He is likely to produce receipts, or show rings that he had supposedly just purchased before praying at the temple and urge you to proceed to the shop before they close.
    Regardless of whether the tourist asks the tuktuk driver to go to the shop, the latter will bring the tourist to the shop and admit that he is given a petrol voucher for bringing the tourist there. The latter is encouraged to just go in to have a look. Thereafter, the owner of the shop will take over with the sales pitch. A friend of mine who relayed this incident to me told me that they are very convincing and a tourist may be enticed to buy one or two pieces for himself. The greedier ones may purchase more of up to US$5000 as claimed by the retailer as the Thai government will impose tax if the amount exceeds US$5000. Furthermore, the retailer is offering a 30% discount store wide.
    During my visit there, I was unwillingly brought to such a shop in the same scenario as described. However I remembered the advice given by the locals to not trust anyone who approaches you with fantastic deals. As the old saying goes, “If it is too good to be true, it is.” Many of us do bear that in mind but forget all about it when faced with such a scenario. My friend bought a ring for himself and found out through a geologist here that such scams are very common and that the stones are genuine but are usually overpriced. A test confirmed that the stones were natural but were treated to enhance their colour and hence carry no real value to the stone. Google “thai gem scams” will reveal many similar stories from websites such as http://www.angkor.com/2bangkok/2bangkok/Scams
    I am writing in to inform others who may be unaware of such scams that target tourists. Many of these gem scams go unnoticed as it does not make economic sense to return to Bangkok just to demand a refund. Some retailers will get the tourist to sign a form stating that no refund is allowed and there is very little recourse that can be done after the transaction is through.
    I urge all travelers to do some research on the country of their visit before they arrive there and to report any scams that happened to them to the local authorities in the hope that follow-up action can be done to reduce the number of scammers on the streets. The fact that the gem stones are genuine but overpriced means that the local authorities cannot do much legally unless the stones are fake and hence it becomes a criminal act. In some cases, the officials and police officers are corrupt, while others may refer you back to the retailer to resolve the issue on their own.
    Be street-smart and do not allow strangers the chance to approach and sweet talk you into a bargain. If in doubt, simply walk away and ignore them, or request information from the tourist police or the local tourism board before making any purchases. Remember the golden rule, if it sounds too good to be true, it usually is! In cases targeted at tourists, it always is.

    #1 Posted: 7/9/2007 - 08:11

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  • chopin

    Joined Travelfish
    28th April, 2007
    Posts: 154
    Total reviews: 2

    Foreigners helping with the gem scam

    http://2bangkok.com/2bangkok/Scams/sapp08.shtml

    It was probably only a matter of time...

    From an email we received:

    Hello,

    I wish my husband and I had stumbled upon your email before we went on our honeymoon to Thailand. Please do not use my name, but I am writing to tell you my story, which is very similar to the ones listed on your website. The only difference is, the Thai people have started recruiting foreigners for their scam.

    We were on our way to Wat Po, following the Lonely Planet walking tour when we were stopped by several tuk-tuk drivers telling us that it was closed for some special Thai holiday. We ignored them until some nicely dressed man walked up to us and told us he WORKED at Wat Po and that it was closed. He then said that we should visit the standing Buddha and some other Wats and pay NO more than 20 baht to a tuk-tuk driver. He then flagged down a tuk-tuk driver who happened to be parked on the road and told him where to take us. He briefly mentioned the export. When we got to the second temple, we walked in and there was a Caucasian guy who started following us. He then asked us where we were from and told us he was from France. We walked around the wat with him and then a Thai man came up to us and was very friendly telling us he was leaving for Japan tomorrow and that he worked for UNICEF. He told us all about the last day of this export and how he had bought a set. He casually asked the French guy if he knew about it and he said that this was his SIXTH! trip to Thailand funded by the profits he made from selling his jewelry back in France.

    Needless to say, we were ripped off and soon discovered it after my husband showed me a section in the Lonely Planet book on scams. By the time we made it back to the shop that sold us the gem, it was closed and there were a bunch of punks out front telling us to come back the next day. We were set to leave for Phuket the next day, so we pretty much thought it was too late. Luckily, we did not spend $3000 on a full set and only bought a necklace. It still burns though.

    It definitely brings the scam up to a new level with a non-Thai conspirator. Words cannot explain what I hope will happen to that French man.

    I will definitely tell my friends about your website if they are planning a trip to Thailand.

    #2 Posted: 7/9/2007 - 08:52

  • ChangFai

    Click here to learn more about ChangFai
    Joined Travelfish
    10th April, 2007
    Location Thailand
    Posts: 139

    New Latest gem scam from Golden Argosy - September 7, 2007
    A reader reports: I just suffered the standard thai gems scam. It was at the "Golden Argosy Factory Export Center", former "Blue Dragon...".
    I details of the scam are not new to what you've read so many times.
    I got back 83% of what I paid, but worst than the lost money is the feeling of embarrassment and humiliation.
    What I am more scared about is that the police is also in the game, the tourist police as well as the normal police. They do absolutely nothing, they supported the store manager when he was claiming that the 17% I lost was to cover the export charges, the VAT and the credit card charge... when we all knew there is no such charges when the transaction is cancelled.
    The police did not even want me to take a picture of the store, which I did.
    The credit card charge cannot be cancelled, requires a claim which they would win since all papers are signed by me. I could not even return the good s without signing a paper confirming I was satisfied and no further actions would be taken. Didn't want to do so but, with the police in the room, they would not accept the goods otherwise.
    I'll try now with the embassy and writing about this to the main tourist web pages.
    More: Tourist police in Bangkok is completely corrupt by the way, they are in the game. When I took the picture of the store, the police tried me not to take it claiming he already had one pic... it was a pic of the same store but with different name!!
    They came with me to ask for the refund but supported the guy in the store claiming he had charges of 17% that I must pay for... police and hotel security (sheraton) supported him, simply amazing!

    #3 Posted: 7/9/2007 - 14:54

  • joenerf

    Joined Travelfish
    7th July, 2011
    Posts: 10

    Just wanted to update people on the Gem Scam. As of November 2011, its still going strong.

    They even used an American posing as a tourist claiming to buy gems yearly. Fortunately I wasn't about to "max out" my credit card on blue sapphires as this guy suggested, but I imagine they only need one person to fall for that to make it a success for them.

    The way it worked in my case: we walked to the Grand Palace, and a nicely dressed Thai man approached us and identified himself (with his name badge) as working for the Tourist Police. He said the Grand Palace was closed - I said that I was told it was not closed because of the floods - he laughed and said "no, its not closed because of the floods, it was closed for a Budhist Holiday".

    Anyway, just as the above posts indicated, I was given a map of other places to see, and the "tourist police officer" even let me know a little inside secret about a gem expo that only happens once a year.

    While we were at the Happy Budha temple, a nice Thai businessman was there and struck up a friendly conversation with us. Somewhere in there he mentioned how he made money buying gems at the gem expo and selling them in North America. Just then, a western tourist walked in.

    As we walked out, the western tourist (who didn't look like the sleeze-bag he must have been), started talking to us. He said he was from the Bay Area, and he was visiting Thailand for the seventh time. He said it was funny how the guy in the temple mentioned the gem expo, becuase that was the reason he comes to Thailand for his yearly vacation. He claimed he buys gems and re-sells them back in San Francisco for a huge profit. He suggested I "max out" my credit card and make a huge profit like he does.

    Fortunately, I didn't do that when we got to the gem expo (which was just another gem store).

    Be very careful of this scam. They utilize a whole network involving westerners, Thai businessmen, and people who appear to be officials. Its well orchestrated, and its probably effective, because the gem stores don't make any claims, they leave it up to the scum-bags you meet to grease you up to buy these gems.

    Anyway, the gem scam is alive and well in Bangkok, and there are even westerners helping out. Watch out for it. Don't believe anyone who says any temple is closed for any reason.

    #4 Posted: 21/11/2011 - 17:50

  • oscarcat

    Joined Travelfish
    11th November, 2008
    Location Cambodia
    Posts: 66

    In other news it's not safe to drink the water....

    #5 Posted: 21/11/2011 - 18:07

  • Captain_Bob

    Click here to learn more about Captain_Bob
    Joined Travelfish
    27th May, 2006
    Location Thailand
    Posts: 1645

    Oldest scam in the book. And yet people continue to fall for it. Unbelieveable!
    Hundreds of accounts of it here

    #6 Posted: 23/11/2011 - 07:34

  • Briareos

    Joined Travelfish
    4th August, 2011
    Posts: 10

    It seem's kind of obvious what is going to happen. I mean I wouldn't believe someone here in the UK trying the same thing and it does happen.

    "I sell watches and need to meet my targets, this normally sells at £xx you can have it for £xx".

    Sounds to good to be true? Walk away surely? Hopefully I don't really come across this when I am away and am aware of it going on so will continue about my business.

    #7 Posted: 23/11/2011 - 08:07

  • joenerf

    Joined Travelfish
    7th July, 2011
    Posts: 10

    I think the reason that it works is two fold:

    1) The gem scammers prey on first-time visitors out on their very first scurry to a major tourist attraction in Bangkok. Not people who have been in Thailand for months and frequent this forum.

    2) The scam is right in the open, and well organized by the scammers and ignored by the authorities (they've been doing it for over 50 years, they know what works and doesn't)

    Its easy for someone who has been to Bangkok a few times to say: "duh, of course its a scam. Next you're gonna tell me not to drink the water". BUT its entirely different for someone who has just landed in the country, and is told by what appears to be an official, that the attraction is closed, and they will help you re-organize your day.

    I knew all about the scam from this and other websites, but it amazing to actually see someone posing as an official, right squarely outside a government building re-directing people away from that building in broad-daylight. After 24hrs in Bangkok, you come to expect that, but in the first few hours, you don't believe that anyone could get away with such a scam out in the open.

    In my case, I was saved because 1) I'm too cheap to max out my credit card, and 2) I had read about this scam and was able to identify it once I took a second to think about the situation.

    But these scammers only have to get lucky 1% of the time to cash in on a major pay-day. Its a shame that Thai authorities are too curropt to deal with it. It really lowers a travellers view of entire country.

    #8 Posted: 23/11/2011 - 15:18

  • oscarcat

    Joined Travelfish
    11th November, 2008
    Location Cambodia
    Posts: 66

    This scam works because of greed.

    #9 Posted: 24/11/2011 - 08:26

  • Tennouji

    Joined Travelfish
    22nd September, 2007
    Location Japan
    Posts: 110
    Total reviews: 20

    These scams always seem to feature the "Happy Buddha" temple. Is it even a major temple?

    Most guide books feature a scam section, but I guess a lot of the victims think they are too smart to fall for one. Apparently, cult members are supposed to be of higher than average intelligence as they can't believe that they would be conned as well.

    Having said that, when you are tired and jet-lagged and disorientated all sorts can happen. My first trip Asia (and only third abroad) resulted in believing a cab driver who told us he had never heard of the Delhi equivalent of Khao Sarn Road, being dropped in a tourist office and having several aggressive locals and a stoned westerner trying to sell us flights to an area that had just be-headed several westerners! We paid about 1000 rupees for the ride instead of 100 rather than tell them where to go. Dealing with all that after an over-night flight, in 40 degrees and still wearing flight clothes was a bit much. Only took a couple of days to wise up to everything, but I still cringe when I remember answering "Yes" to the taxi driver's "First time in India?"

    #10 Posted: 28/11/2011 - 08:44

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  • Sparts

    Joined Travelfish
    5th June, 2009
    Location United Kingdom
    Posts: 166
    Places visited:
    At least 17

    Who goes on holiday to make money, that's what gets me. The mind boggles.
    I'm sorry but I find it difficult to feel remotely sorry for anyone who falls for this. It's not a hard sell, there is no pressure other than from the victims own greed. Apologies if that offends anyone.

    Parting with large sums of cash while overseas is way too risky.

    #11 Posted: 29/11/2011 - 14:51

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