Although the cachet is formally an agreement between a buyer and a seller, its most important function in the market is to regulate the relationship between a seller and his broker. If no cachet were used and the buyer offered five hundred dollars per karat for the stone, the broker might tell the seller that the buyer offered four hundred dollars per karat. If the seller accepted, the broker would pocket the difference. This is not the type of dishonest behavior that could be easily monitored and enforced through reputation bonds since detection and a determination of the precise circumstances would be difficult.

DEFINE: Explains how the cachet functions in diamond markets, clarifying its purpose beyond its formal buyer-seller framing.

Lisa Bernestein, Opting out of the Legal Sys…, loc. 64