FAKE SWISS GOLD BARS IN CIRCULATION
Our deep thanks to M.D. for spotting this "little" story, because I suspect that there's much more lurking here than meets the eye, and I'll boil it down to a bit of a supremely wild and woolly high octane speculative thesis: (1) if you can have a hidden system of finance, reliant upon fraud, cooked books, outright theft, and re-hypothecation to infinity (and trust me, there's a relationship to Mr. Central Bankster's flirtations with infinite debt here), then (2) you can have fake gold standards.
"Say wha....?" you might be asking. Patience, we'll get back to that. Here's the article from Reuters that M.D. spotted:
Now you might recall I've blogged several times about these "fake gold bar" stories, usually in connection with the discovery of gold-coated tungsten bars out of China, or in connection to gigantic billion-plus-dollar loans collateralized by fake gold (also out of China). I mention all this because it provides a nifty context in which to weigh the current flight from the American dollar as more and more countries appear to be willing to entertain China's yuan as a basis of some sort of reserve currency... that's how bad America is being perceived right now if you're willing to trust a country where that sort of fraud and corruption takes place, and I suspect it's what happens when countries whose currency is a reserve currency weaponize that currency for the maintenance of a political policy narrative: trust in it quickly evaporates. No surprise there.
But there might be something else going on. Consider the following from the article:
Gold bars fraudulently stamped with the logos of major refineries are being inserted into the global market to launder smuggled or illegal gold, refining and banking executives tell Reuters. The fakes are hard to detect, making them an ideal fund-runner for narcotics dealers or warlords.
In the last three years, bars worth at least $50 million stamped with Swiss refinery logos, but not actually produced by those facilities, have been identified by all four of Switzerland’s leading gold refiners and found in the vaults of JPMorgan Chase & Co., one of the major banks at the heart of the market in bullion, said senior executives at gold refineries, banks and other industry sources.
Four of the executives said at least 1,000 of the bars, of a standard size known as a kilobar for their weight, have been found. That is a small share of output from the gold industry, which produces roughly 2 million to 2.5 million such bars each year. But the forgeries are sophisticated, so thousands more may have gone undetected, according to the head of Switzerland’s biggest refinery.
But these are not your standard-issue fake gold bars with gold wrapped around an inert and relatively worthless metal like lead or tungsten. Oh no:
The counterfeits in these cases are subtler: The gold is real, and very high purity, with only the markings faked. Fake-branded bars are a 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.
Ahh... so it's a way of disguising "conflict bullion"... I see. Oh, but wait, maybe not:
High gold prices have triggered a boom in informal and illegal mining since the mid-2000s. 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 that would not otherwise be legal or acceptable in the West – for example in 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 executives and bankers told Reuters they think 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. Once accepted by a mainstream gold dealer in these places, they can quickly spread into supply chains worldwide.
Help the Community Grow
Please understand a donation is a gift and does not confer membership or license to audiobooks. To become a paid member, visit member registration.