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The Watch Turned Out to Have Been Stolen; How Can This Jeweler Recoup His Loss?

The jeweler he bought it from isn’t returning his calls.

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AS BOB LAYTON hung up the phone after leaving yet another voice message for his fellow jewelry retailer, he rubbed his temples in frustration. What once had appeared to be a stroke of good fortune had now turned into a nightmare situation, and he was at a loss as to how to proceed.

ABOUT REAL DEAL

Real Deal is a fictional scenario designed to read like real-life business events. The businesses and people mentioned in this story should not be confused with actual jewelry businesses and people.

ABOUT THE AUTHOR

Trace Shelton is the editor-in-chief of INSTORE magazine. He can be reached at trace@smartworkmedia.com

It had all begun innocently enough. One of Layton Jewelers’ best customers, Ron Lim, had asked him to be on the lookout for a particular style of Rolex: a green “Kermit” model from 2005 in stainless steel. For several months, Bob had been keeping an eye on auction sites and social media, but nothing had turned up. Then he saw it posted on a Facebook trading site: The exact watch that Ron was asking for, listed at $10,300.

Bob private-messaged the retailer who had listed the watch. It turned out to be James Shooter, a jewelry store owner whose business was located on the other side of Bob’s home state of Missouri. James and Bob had first been introduced years ago, but their relationship was purely that of acquaintances. Bob knew that James’s store, Jewelcraft Unlimited, was well known in its St. Louis community for buying previously owned jewelry. As such, Bob had implicit trust that James knew what he was doing when it came to buying and selling “off the street.”

James explained that the watch had been presented to him as part of an estate. The Rolex was in like-new condition and came in the box with all the appropriate paperwork. Per local regulation, James had held onto the lot for 30 days before offering any of the pieces for sale. While the jewelry items had sold rather quickly, the watch turned out to not be of much interest to Jewelcraft Unlimited’s customers. After keeping it in the case for three months without a bite, he had posted the watch on Facebook. For his part, Bob said that he had a client looking for the watch and that he would be willing to pay $9,200 for it. In the end, they settled on a price of $9,600, and James had the watch securely delivered to Bob at Layton Jewelers.

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Meanwhile, Bob had contacted Ron to let him know that he’d found a watch matching his requirements and would sell it to him for $16,350. Ron was over the moon. He paid Bob over the phone and said he would pick it up in a few weeks once he returned from a business trip.

Unfortunately, that’s when things began to go wrong. One week after the watch arrived at Layton Jewelers, two Missouri state police officers paid Bob a visit, asking to see the watch. Bob told them that the watch was sold, but that he was still holding it in his safe for customer pickup. After matching the serial number on the watch to their own paperwork, the officers told Bob that they would have to confiscate the watch, as it had been stolen during a home break-in five months prior. They had recently apprehended the thieves and traced the watch to him via James at Jewelcraft Unlimited.

Distraught, Bob called Ron immediately. Fortunately for him, Ron was very understanding and took the credit back on his American Express card while asking that Bob continue to search for another watch. However, the bigger problem was James, who was unreachable. Bob had tried texting, calling and emailing, all to no avail. With $9,600 on the line, it wasn’t something that Bob felt he could just “let drop,” but at the same time, he wasn’t sure how to proceed from here.

The Big Questions

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  • Does he have an obligation to get involved at all?
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Philip F.
Carmel, CA

Been there with this exact situation. Each state has their own laws, and they may vary slightly from state to state. However, for the most part, each party is responsible for their own actions to the next in line. In this case, James is responsible for repaying Bob $9,600. James can go back to his “estate” and attempt to get his money back. If that fails, and if James has a good insurance company, he can turn to them for coverage (less his deductible). If Bob is unable to collect from James, he then can also turn to his insurance company for coverage. It appears that the parties involved followed proper protocol and procedures, and insurance reimbursement is likely. The insurance companies can decide whether or not they want to pursue their issues further in court.

Jennifer J.
Woodstock, IL

If I were James, I would give Bob back his money. We all know the risks of buying “off the street,” and James should be protecting his clients. We have had scrap items confiscated in the past, and I chalk it up in the loss column. I made that purchase, so I consider it my risk. I would have reached out to Bob immediately after talking to the police and apologized and offered his money back.

Sandi B.
Ocala, FL

I don’t know about you, but $9,600 is worth a face-to-face visit. Yet another reason not to do business with someone you have never met. Yes, James should be accountable for the money. Especially if he possibly broke laws in acquiring the watch and did not go through Pawn WEB or another legal preowned merchandise site. That seems like a pretty big loss just to take it on the chin!

Richard S.
San Luis Obispo, CA

This is one of the risks of buying off the street. Each state is different. In CA, if the jeweler is a licensed secondhand buyer and all DOJ rules were followed, the store still has a lien on the title of the watch and has the right to collect their original purchase payment plus 3% from the original owner. In either case, the second jeweler should receive a full refund from the first jeweler as the title to the watch was clouded and not delivered.

Cameron K.
Saskatoon, SK

If James had reported the watch to the local police to verify prior to paying the client for the timepiece, everything could have been averted. With prominent serial numbered timepieces, it’s always best to be safe than sorry when buying off the street. James needs to repay Bob; it was James’s lack of due diligence that caused the mistake.

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Stan G.
Charlotte, NC

James owes Bob $9,600 plus any shipping fees. Buying off the street has its risks, but Bob didn’t buy off the street. James at Jewelcraft Unlimited did. Just because he followed the 30-day hold period doesn’t absolve him of the responsibility of reselling an item with a “clean” history. If I was Bob, I wouldn’t waste time calling James any longer. I’d have my attorney fire off a strongly worded letter sent by certified mail and then haul his ass into court if needed. Next case, please …

Peter T.
Show Low, AZ

The criminal should be responsible for James’s loss (not the $9,600, just the amount he paid for the watch). But that’s not likely to happen with our judicial system. As it is, James sold stolen property to Bob. Unless he wants to be arrested for that, he owes Bob $9,600. Bob might need to point that out to James. Anybody who buys off the street should know that eventually they will buy stolen property. The store that makes a deal with a criminal will have to accept the loss of whatever they paid when that happens. That’s part of the cost of doing business. The only protection is to understand business. Which is: pay low enough and sell high enough to offset the expenses and losses that will occur along the way.

Trisha C.
Osterville, MA

My questions are:

  • Did James properly file correct paperwork when he purchased the entire lot?
  • Did the proper original owners file a police report and/or insurance claim? If so, why did it take over six months to recover?

If the original owners filed the proper paperwork, it should have been recovered sooner. Not sure about Missouri laws, but here there is a weekly/monthly report that needs to be filed to local law enforcement to locate such goods. It seems that someone either didn’t file paperwork or the watch was ill-gained. Regardless, the cost of the watch should be refunded by the seller since he was “unaware of provenance.” If he has proper paperwork (seller info), he may be able to recoup and refund his buyer. Depending on state laws, both may have legal recourse for retribution depending on state laws. Either way, make sure you cover your liabilities when buying over the counter.

Marcus M.
Midland, TX

This is why I don’t buy from the public, especially pre-owned Rolexes. You just never know what you’re going to get. James should definitely pay Bob back and then figure out how to recoup his losses. That’s the right thing to do, but many people these days don’t do the right thing. Anyway, James needs to track down who presented it to him as part of an “estate” and go after them. If it’s a dead end, then surely his insurance will cover. If Bob needs to, I’m sure he can go after James because he sold him a stolen piece of property and that’s illegal. I’d get nasty with James if he keeps ignoring Bob’s calls because at the end of the day, he’s out $9,600 and that’s not an easy pill to swallow.

Ty V.
Santa Rosa, CA

So you buy the watch for $9,200 and sell it to your customer for $16,350? What a rip-off, why would you charge your customer such a markup? GREED. As an official Rolex Jeweler, we only make 35% on a new watch. Such greed!!!

Sara N.
Friendswood, TX

Sadly, if James is not responding, that would tell me he figured out it was stolen and has no intention of reimbursing Bob. Bob can try to claim it on insurance, but with the deductible, it might not make sense. Bob is going to have to treat this as a theft.

Jim D.
Kingston, NH

Of course James is responsible for paying Bob back, cost and shipping. That is black letter law; he has to make Bob whole. The problem is for James to deal with as the buyer of stolen goods. It is a risk we all take if we buy off the street. Though James did the right thing in his process, there is not always a way to be 100% certain in some cases. James should go against the thieves, though I doubt they have assets other than possibly bail money to attach. I know some states have a database of stolen goods that can be checked, but not all do and the data can be old.

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Alan L.
Cape May, NJ

Is there honor among thieves? James is responsible to repay for the stolen Rolex. With a police confiscation, there is no doubt as to the Rolex being stolen and then surrendered without remuneration. Even though James presented the Rolex as having been part of an estate, James bought the Rolex from “the street” and liability does rest with him. It may be tough to recover the purchase price from James even with police documentation as to theft because buying from the street is a dirty business. Is risk inherit with used Rolex? Of course it is, that’s why the profit margins are greater because you are trading in broken dreams and sometimes shattered lives.

Some like to pretend they are helping restore people in times of crisis, but there is a lot of quick-hit profit for those who turn a blind eye.

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