The global market is experiencing new sophisticated form of forgery. Formerly, criminals used blocks of cheap metals and plate them with gold, which was easier to detect. With the current trend, the gold is real and very high purity, only the markings are faked
The global market is experiencing new sophisticated form of forgery. Formerly, criminals used blocks of cheap metals and plate them with gold, which was easier to detect. With the current trend, the gold is real and very high purity, only the markings are fake .
The fake gold is hard to detect, making them an ideal fund-runner for narcotics dealers or warlords.
The fake-branded gold bars are relatively new way to flout global measures to block conflict minerals and prevent money-laundering. Such forgeries pose a problem for international refiners, financiers and regulators as they attempt to purge the world of illicit trade in bullion.
From 2016, four Switzerland leading gold refiners and one of the major banks in the heart of the market bullion the vaults of JP Morgan Chase & Co. have found about USD50M worth of gold bars stamped with Swiss refinery logos but are not actually produce by these facilities.
It is largely speculated that the forged bars began to circulate quietly in the gold industry circles after the first half of 2017, when JP Morgan, one of five banks which finalise trades in the $10 trillion-a-year London gold market, found that its vaults contained at least two gold kilo bars stamped with the same identification number.
Without the stamp of a prestigious refinery, such gold would be forced into underground networks or priced at a discount.
By pirating Swiss and other major brands, metal that has been mined or processed in places where conflict, human rights abuses, or sanctioned regimes make it illegal or unacceptable for trade on the global market – including parts of Africa, Venezuela or North Korea – can be injected into the market, channeling funds to criminals or regimes that are sanctioned.
It is not clear who is making the bars found so far, but it is suspected that most originate in China, the world’s largest gold producer and importer and have entered the market via dealers and trading houses in Hong Kong, Japan and Thailand.
The most reliable way to identify the fakes is to test their purity. Gold is available on world markets in varying levels of purity: For professionally produced kilo bars, the most common standard is 99.99 percent – known in the trade as “four nines.” An analysis of three counterfeit-branded bars by one Swiss refinery showed that two of them were 99.98 percent pure, and the third 99.90 percent.
Though the fakes are short of legitimate professional standards, even that level of purity is difficult to achieve and takes advanced equipment to detect.