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Perth Mint... accused of diluting purity of gold in bars

tincuptincup Posts: 4,722 ✭✭✭✭✭

Supposedly they started adding silver and copper to minutely dilute/dope the concentration.... while supposedly still keeping purity above 99.99? But.... China had taken delivery of 100 tons, and after testing say the concentration of silver is too much to meet Shanghai Gold Exchange (SGE) standards. And supposedly, Perth Mint knew it... but tried to cover it up. If true, nice way to destroy a reputation....

https://zerohedge.com/news/2023-03-06/breaking-point-perth-mint-manipulated-physical-gold-delivery-china

----- kj

Comments

  • SilverPlatinumSilverPlatinum Posts: 205 ✭✭✭
    edited March 6, 2023 5:13PM

    ===It began 'doping' or diluting it's gold in 2018, which involves mixing in copper or silver but keeping the purity above 99.99 per cent===
    I cannot understand this part! How can you dilute the purity yet keep it 99.99% !!!

  • tincuptincup Posts: 4,722 ✭✭✭✭✭
    edited March 6, 2023 6:27PM

    Kind of puzzling to me too. My guess.... some very rough numbers....?

    Let's say you have a ton of gold essentially pure, greater than the .9999..... you can melt it, in theory replace 9.6? ounce of gold with silver or copper.... and perhaps the mixture will still assay out at just slightly above .9999....

    You will then have saved 9.6 ounces of gold! Extrapolate that to the 100 tons of gold that China bought.... you have saved 960 ounces of gold! Do the arithmetic, and could be quite a savings.

    Only problem is, if you misjudge just a little, or your assay is off just a little (there is always a range, however small / accurate it may be). Then you can find yourself in a mess like Perth Mint may be in, in regards to the perceived trust in product etc.

    To me.... probably not a concern. I have always liked Perth Mint products,

    So I certainly cannot attest to the accuracy of the news.... just saw the article, and thought it interesting. And of course, one must factor in who is making the claim.... China... so who knows what the situation really is.

    ----- kj
  • tincuptincup Posts: 4,722 ✭✭✭✭✭
    edited March 6, 2023 6:58PM

    And another article pointed out the mint's product purity complied with broader industry standards. So not sure why it did not 'meet' SGE standards. And appears to only concern the large size exchange bars.

    ----- kj
  • tincuptincup Posts: 4,722 ✭✭✭✭✭

    The practice of 'doping' appears to be an accepted practice in the industry. (a part of quality control, and can save a lot of money). But.... it is high risk.

    https://abc.net.au/news/2023-03-06/perth-mint-gold-doping-china-cover-up-four-corners/102048622

    ----- kj
  • derrybderryb Posts: 36,030 ✭✭✭✭✭
    edited March 6, 2023 7:28PM

    @tincup said:
    And another article pointed out the mint's product purity complied with broader industry standards. So not sure why it did not 'meet' SGE standards. And appears to only concern the large size exchange bars.

    SGE standards are likely the same as those on the LBMA and COMEX for "good delivery" bars that are admitted to and released from their vaults. Strict standards to ensure continuity with quality of all bars the exchanges handle. I have no doubt that Perth bars have the gold content that Perth says they have. This minute "diluting and doping" are likely common across the mint board for products not intended to meet "good delivery" standards. Not the big news story it sounds to be.

    The decline from democracy to tyranny is both a natural and inevitable one.

  • rickoricko Posts: 98,724 ✭✭✭✭✭

    Seems like it sounds worse than it actually is. Maybe China is just fighting for a price break. Cheers, RickO

  • tincuptincup Posts: 4,722 ✭✭✭✭✭

    That's kinda what I'm thinking.... like one of those 'nuisance' types of lawsuits.... just make a quick payment of something to make it go away.

    ----- kj
  • jmski52jmski52 Posts: 22,269 ✭✭✭✭✭
    edited March 7, 2023 7:00PM

    Sounds like the QC Manager needs stricter guidelines, and maybe a more thorough sampling procedure. If the quality was acceptable for most of the industry, perhaps China should be paying a premium for the extra assurance (and probably extra work to make their specs).

    Q: Are You Printing Money? Bernanke: Not Literally

    I knew it would happen.
  • fcfc Posts: 12,788 ✭✭✭
    edited March 8, 2023 10:50AM

    The gold is fine. They added too much silver and not enough copper/other things (or removed). The small tiny silver aspect went over the allowable limit for one region's specs. The region where I do not even trust buying stuff from. Go figure.

    https://en.sge.com.cn/upload/file/202001/17/SzezpDJeHMoSlnON.pdf

    see 4.3.1

    Should have added that lead back in or something. If anything that gold has more silver then the rest of their stuff which makes it ?slightly more desirable?

  • blitzdudeblitzdude Posts: 5,296 ✭✭✭✭✭

    @SilverPlatinum said:
    ===It began 'doping' or diluting it's gold in 2018, which involves mixing in copper or silver but keeping the purity above 99.99 per cent===
    I cannot understand this part! How can you dilute the purity yet keep it 99.99% !!!

    Consider the source, the article is from conspiracy hedge. Fake news. RGDS!

    The whole worlds off its rocker, buy Gold™.

  • jmski52jmski52 Posts: 22,269 ✭✭✭✭✭

    I cannot understand this part! How can you dilute the purity yet keep it 99.99% !!!

    Doesn't the article say specifically what they were doing?

    Q: Are You Printing Money? Bernanke: Not Literally

    I knew it would happen.
  • RobMRobM Posts: 527 ✭✭✭

    The original material would have been purer than .9999. For example, say it was .99999 and the mint adds a little silver to bring the gold content down to .9999. The "doped" gold would only be identifiable because the impure portion (the .0001) would consist of much more silver than would be expected and iron, copper, and lead would be underrepresented. One could argue that at identical purities, the doped gold should be more valuable since the trace amounts of silver is more valuable than those other impurities. But I think the argument, if there is actually one, is that instead of selling gold with a MINIMUM purity guarantee, where it would assay somewhat higher, the mint diluted the gold so that it was essentially almost equal to the .9999.

  • tincuptincup Posts: 4,722 ✭✭✭✭✭

    Exactly. why send them gold that might actually be .999999,,,,, dilute it down some and pocket the difference! When dealing in tons, does result in some savings, and extends your gold supply a slight bit more.

    ----- kj
  • derrybderryb Posts: 36,030 ✭✭✭✭✭

    @blitzdude said:

    @SilverPlatinum said:
    ===It began 'doping' or diluting it's gold in 2018, which involves mixing in copper or silver but keeping the purity above 99.99 per cent===
    I cannot understand this part! How can you dilute the purity yet keep it 99.99% !!!

    Consider the source, the article is from conspiracy hedge. Fake news. RGDS!

    choice of a news source has become a poiltical issue. blame the news sources for that. i miss walter cronkite

    The decline from democracy to tyranny is both a natural and inevitable one.

  • blitzdudeblitzdude Posts: 5,296 ✭✭✭✭✭

    @derryb said:

    @blitzdude said:

    @SilverPlatinum said:
    ===It began 'doping' or diluting it's gold in 2018, which involves mixing in copper or silver but keeping the purity above 99.99 per cent===
    I cannot understand this part! How can you dilute the purity yet keep it 99.99% !!!

    Consider the source, the article is from conspiracy hedge. Fake news. RGDS!

    choice of a news source has become a poiltical issue. blame the news sources for that. i miss walter cronkite

    No politics here brother! I choose to live life MOSTLY on my terms. It's short and precious, certainly not going to let the dirtbag politicians rule my day. RGDS!

    P.S about the only thing green on my board today was the Au, that and a few healthcare stocks and a bond fund or two. Brutal but I didn't even give 2 shites. :sunglasses:

    The whole worlds off its rocker, buy Gold™.

  • tincuptincup Posts: 4,722 ✭✭✭✭✭
    edited March 10, 2023 7:40AM

    While the first source I referenced was zerohedge, there are multiple other sources also. Second reference was to an ABC Australian source.

    Just posting a news item. Value as you please (hey... that should be on a coin or token! ;) )

    ----- kj
  • RobMRobM Posts: 527 ✭✭✭

    @tincup said:
    While the first source I referenced was zerohedge, there are multiple other sources also. Second reference was to an ABC Australian source.

    Just posting a news item. Value as you please (hey... that should be on a coin or token! ;) )

    Hah, i was tempted to post the same pairing yesterday. It does border on the political but there is lots if irony there. ZH is more of a news aggregator than publisher of original works, and is definitely libertarian/conservative leaning. ABC is the left leaning public broadcaster of Australia and did a story on the issue on its Four Corners program.

  • streeterstreeter Posts: 4,312 ✭✭✭✭✭

    @blitzdude said:

    @SilverPlatinum said:
    ===It began 'doping' or diluting it's gold in 2018, which involves mixing in copper or silver but keeping the purity above 99.99 per cent===
    I cannot understand this part! How can you dilute the purity yet keep it 99.99% !!!

    Consider the source, the article is from conspiracy hedge. Fake news. RGDS!

    No, the article is from the Daily Mail in England. ZH is an Amalgamated site publishing articles from different channels around the world. Unless you subscribe to the Day Mail you would not have seen this information.
    Get your facts straight.

    Have a nice day
  • tyler267tyler267 Posts: 1,232 ✭✭✭✭

    After reading this I looked up the purity requirements for LME, COMEX, and SGE. SGE is the only one that sets standards for the various metals alloyed with the gold, not just the purity of the gold itself. Doesn't make much sense to me, seems like the gold purity is what matters. So looks like Perth Mint had the proper gold content but the way it was alloyed did not meet SGE standards. Unless there is something else going on I'm not sure why this is news, and I'm not sure why the article kind of implies the Perth Mint may have done something unethical. I understand why an entity selling tons of gold would want it be be at exactly the correct purity not higher or lower.

  • blitzdudeblitzdude Posts: 5,296 ✭✭✭✭✭

    @tyler267 said:
    After reading this I looked up the purity requirements for LME, COMEX, and SGE. SGE is the only one that sets standards for the various metals alloyed with the gold, not just the purity of the gold itself. Doesn't make much sense to me, seems like the gold purity is what matters. So looks like Perth Mint had the proper gold content but the way it was alloyed did not meet SGE standards. Unless there is something else going on I'm not sure why this is news, and I'm not sure why the article kind of implies the Perth Mint may have done something unethical. I understand why an entity selling tons of gold would want it be be at exactly the correct purity not higher or lower.

    Much ado about nothing. Most would say clickbait. RGDS!

    The whole worlds off its rocker, buy Gold™.

  • derrybderryb Posts: 36,030 ✭✭✭✭✭

    The decline from democracy to tyranny is both a natural and inevitable one.

  • tincuptincup Posts: 4,722 ✭✭✭✭✭

    " So looks like Perth Mint had the proper gold content but the way it was alloyed did not meet SGE standards. Unless there is something else going on I'm not sure why this is news, and I'm not sure why the article kind of implies the Perth Mint may have done something unethical. "

    Agreed.

    Would not call it 'clickbait'; to me more like some international politics at play. Hard for me to fathom any other reason why it should be a concern. Certainly not a concern for me.

    ----- kj
  • dcarrdcarr Posts: 7,900 ✭✭✭✭✭

    I think it unlikely that any major mint or refiner would take metal that was better than 999 purity and dilute that metal to 999.

    I would suspect that any bullion that doesn't quite meet the advertised purity is because the refiner of the metal was cutting corners (costs) in the refining process.

  • TwoSides2aCoinTwoSides2aCoin Posts: 43,760 ✭✭✭✭✭
    edited March 13, 2023 6:11AM

    Doesn't meet standards. That's funny China would worry about purity or weights and measures.

    Their one ounce pandas are over a gram short of a full Troy oz.

  • PerryHallPerryHall Posts: 45,205 ✭✭✭✭✭

    @TwoSides2aCoin said:
    Doesn't meet standards. That's funny China would worry about purity or weights and measures.

    Their one ounce pandas are over a gram short of a full Troy oz.

    The Chinese started making the weight of their pandas 30 gr several years ago. Not sure why but that change made them less desirable in the eyes of many gold buyers.

    Worry is the interest you pay on a debt you may not owe.

  • jmski52jmski52 Posts: 22,269 ✭✭✭✭✭

    The reason is likely that most Westerner markets would pay scant attention as long as the size of the coins are roughly the same. Never mind that their premiums are even more ridiculous than the US Mint’s.

    In other words, they (wrongly) assume that we’re just not that bright.

    Q: Are You Printing Money? Bernanke: Not Literally

    I knew it would happen.
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