LBMA: Hidden risks - counterfeiting of precious metals
In a business whose value is measured in grams, and trust is at the heart of every transaction, reliability and security remain key risk factors. However, one threat is often underestimated.: This is the growing quality of counterfeit metal products, according to Lauren Moses, a columnist for LBMA magazine.
The problem goes beyond the low-quality and artisanal crafts sold in tourist markets. This criminal business, estimated at trillions of dollars, is capable of producing forgeries so convincing that they can deceive even experienced professional experts.
Counterfeit metals are associated with organized crime and criminal financing, distort information about the market, undermine confidence in it, but despite this, widespread discussion of the problem is limited precisely because of fears of scaring off consumers and investors.
Scale The fake precious metals market is currently one of the most lucrative in the world, with an annual revenue of about one trillion dollars, and surpasses all other major illegal activities, including drug trafficking, human trafficking, and unlicensed mining.
Corsearch (Brand Protection and Trademark Research) estimates that all counterfeit goods, including metals, accounted for about 3.3% of global trade in 2023 and will reach 5% by 2030.
In reality, one out of every twenty dollars of consumers is spent on counterfeit products. This black market poses a direct financial threat to the global economy, and a systemic risk to legitimate trade operations.
Trends in metals It must be agreed that the statistics of counterfeits are very approximate, as they are estimated and do not fully reflect the risks faced by the precious metals industry, but the facts speak for themselves.
For example, in 2019, more than 1,000 counterfeit gold bars worth more than $50 million were discovered in vaults around the world.
These ingots had fake brands of refineries and corresponded to the expected characteristics — samples and weights. Some were tested for 99.98% gold purity. The highest quality allowed them to move through the global chain of traders, exchanges, banks unnoticed. Eventually, this particular shipment was identified and seized, but it probably represents only a small part of the iceberg that remains in circulation.
It can be assumed that no case has reached such a scale since 2019, but online activity is steadily increasing.
Under the influence of economic uncertainty, consumers turn to tangible assets, which has led to