$2.8 Million ‘Star’ Sapphire Probably Worth Less Than $100,000 - IRS Expert
LOS ANGELES (AP) _ The ″Star of America″ sapphire, touted by its discoverer as worth $2.28 million, is actually an ″insignificant″ stone worth less than one-twentieth that amount, according to gem dealers, curators and appraisers.
″I don’t think the word million can enter into the conversation,″ said Elly Rosen, an independent appraiser who has been a gem consultant to the Internal Revenue Service. ″I think the difficulty would be in the five figures.″
Roy Whetstine of Kilgore, Texas, said he bought the potato-sized rock last year for $10 and claimed he got offers of more than $2 million. He has been displaying it this week at the annual Winter Gem and Mineral Show in Tucson, Ariz.
″If I had any questions about the stone, I wouldn’t have brought it here and put it on display,″ Whetstine said, according to Friday’s editions of The Los Angeles Times.
The Times also reported that court records show Whetstine was ordered to pay $64,000 to a man who complained that a gem he’d been sold was overvalued. Another similar suit was settled out of court, the newspaper said.
Cosmo Altobelli, one of several gem experts interviewed at the winter show by the newspaper, commented that ″none of the people in any of the national press ... ever questioned it (the value).″
″They thought it was a fairy tale story and ran with it,″ said Altobelli, appraisal committee chairman for the American Gem Society.
″It’s an insignificant stone,″ said John Sampson White, curator of the National Gem and Mineral Collection at the Smithsonian Institution. ″We wouldn’t buy it. We wouldn’t want it, I don’t think, even if it were offered to us. We certainly couldn’t accept it as a gift, given the crazy values on it.″
Whetstine provided no specifics on negotiations for the stone, which he says he bought with $5 from each of his young sons. ″I bought it for them,″ he said. The six-pointed star has been cut and polished to a fine lavender luster.
″It is nice to see, it is an oddity ... but that’s it,″ Rosen said from New York.
The man who initially appraised the stone for Whetstine, Lawrence Ward, owner of a jewelry store in Fallbrook, was dropped from membership in the American Gem Society last November over complaints that he had inflated appraisals, according to Laurie Hudson, the society’s marketing manager.
Ward said he was dropped because of a personal vendetta.
Court records show Ward and Whetstine have been accused in two lawsuits of inflating the value of stones, the Times reported.
One suit was settled out of court on undisclosed terms, and in the other Whetstine was ordered to pay $64,000 for breach of contract and also was found liable for ″fraud, deceit and misrepresentation.″ Ward was not found liable.
Whetstine said the judgment had nothing to do with fraud but a simple ″credit debt.″ He said the verdict, coming on top of bills for heart bypass surgery, forced him to declare bankruptcy last year before he bought the stone.
He bought the stone in February 1986 and the next month had the Gemological Institute of America certify it as a 1,906-carat, natural star sapphire.
Ward said he based his appraisal largely on Whetstine’s claim that the rock had come from Idaho, a claim that cannot be confirmed because Whetstine will not identify the seller.