- Perth Mint is under a cloud of controversy about what it knew, and when, in regards to sourcing allegedly unethical gold
- Secret recordings from 2017 contradict an earlier statement made by the refiner that it had no knowledge of bad practices among its suppliers
- The Mint will now undergo an independent third-party audit of its practices
- The London Bullion Market Association (LBMA) has also proposed a separate review to see if ethical standards have been met
- The Mint could lose LBMA accreditation if it’s found in breach of standards
Perth Mint is under a cloud of controversy about what it knew, and when, in regards to sourcing allegedly unethical gold.
Secret recordings from 2017 obtained by the Australian Financial Review contradict an earlier statement made by the refiner that it had no knowledge of bad practices among its suppliers.
Unethical gold?
To maintain accreditation with the London Bullion Market Association (LBMA), refiners must prove their gold is sourced ethically. This includes ensuring there are no human rights abuses across the supply chain.
The Mint has sourced up to millions of dollars in gold from Papua New Guinean company Golden Valley, which has alleged links to child labour and dangerous practices.
The refiner has now suspended ties with Golden Valley and other similarly suspect companies pending further audit.
The LBMA has proposed a review of the Mint’s practices to ensure it’s complying with the requisite standards.
While the Mint has welcomed the review, the new allegations of malpractice could see its accreditation rescinded if it’s proven ethical standards have been compromised.
What’s next?
Premier Mark McGowan has called for an audit into the Mint’s sourcing protocols.
Mint Chairman Sam Walsh has said an independent third-party review will be conducted to assess the Mint’s audit processes. “The review will also assess the arrangements with licensed counter-parties that may deal with artisanal small-scale mining (ASM),” he stated.
“Effective immediately as part of this process, the Perth Mint has suspended relationships with all companies and aggregators dealing with ASM,” Sam continued.
The allegations are particularly surprising, given it was only earlier this year the Mint announced a new technology initiative to track gold from its source to guarantee its ethical provenance.
If it can be proven Mint CEO Richard Hayes ignored the 2017 alarm bells on Golden Valley and other providers, it could spell big trouble.
It’ll probably be quite some time before the Mint’s third-party audit and the LBMA review see the light of day.
In the meantime, there’ll be a lot of folks hoping the Mint’s practices get the gold seal of approval.