There are two red flags to look for: One is when a sales person tells you an item is worth 10 times more than you're paying and two, all sales are final.
Mary Sjostrom wasn't in the market for a ruby and diamond bracelet. So how did she end up with one? It started when she popped in on an auction at a San Bruno senior center, hosted by Kingston Auctions of Southern California.
"They passed it around and someone put it on my wrist and it was nice, but I really wasn't interested," said Sjostrom.
Nobody bought the bracelet -- but as Mary was leaving the auction, it happened.
"The auctioneer stopped me on the way out saying gee I've got something here for you, and he had the bracelet in his hand," said Sjostrom.
He showed her an appraisal certificate saying the bracelet is worth a lot of money -- $34,000 retail. But the auctioneer said Mary could have it for a mere $3,500.
"$3,000 to pay for something that had a $34,000 value would be incredible," said Sjostrom.
So Mary bought it. With fees and taxes, she paid $4,200. Then she went outside and got a closer look.
"The rubies were very, very cloudy a lot of cracks and inclusions in the diamonds," said Sjostrom.
Mary went right back in and asked for a refund. But all sales were final.
"He said, well, try and sell it on eBay," said Sjostrom.
Mary says a local jeweler later told her the bracelet was worth about half what she paid. So Mary called Kingston to demand a refund.
Kingston replied that jewelry is not sold based on the appraisal value, and bidders are warned those values are high.
Mary says she never heard that warning.
"The total estimated retail price is $34,000 which is incredible and that's what I was sold on," said Sjostrom.
Kingston denied her a refund.
"What I decided to do was contact 7 On Your Side," said Sjostrom.
After 7 On Your Side got involved, Kingston agreed to let Mary return the bracelet. Kingston said the appraisals are intended to help customers verify the authenticity of gems, not the value.
Kingston believes Mary got a good deal, but agreed to refund all of her money.
So how do you know if an appraisal is reliable?
We spoke with certified gemologist appraiser David Coll.
"You need to look at the credentials of the appraiser. You want to make sure that those are from prominent labs that have been recognized throughout the industry," said Coll.
The appraisal for Mary's bracelet was done by American International Gemologists of Woodland Hills. The report did point out flaws in the rubies, evidence of heat treatment and glass residue.
David says it didn't deserve that high appraisal.
"This is a low grade ruby, the diamonds are low grade diamonds. Everything about it says it is low grade, and the only thing that stands out about it is this enormous $34,000 price tag," said Coll.
American International has an F rating from the Better Business Bureau. Previous complaints said the company inflated jewelry values.
But the company told 7 On Your Side Mary's appraisal is valid. It's based on the estimated wholesale price of $11,000, tripled for retail sale. The company was in good standing with the BBB until three complaints went unanswered this year.
Jewelry appraisers are not regulated by state law, but auctioneers are. You can demand a refund if you believe you were misled about an item's value. It's best to use appraisers who are certified by groups like the American Gem Society, which do hold members accountable.