Editor’s Note
This article examines the complex reality behind “responsibly sourced” gold labels, revealing systemic gaps in global certification systems that allow conflict gold to enter mainstream markets.
Since the early 2000s, all over the world, laws and regulations have been implemented, and gold industry certificates invented to clean up the gold supply chain. Gold that is processed in the U.S, the United Arab Emirates, Switzerland—any large gold refining site—always has some kind of certification of origin. Gold products bought in the EU, the U.S., and Switzerland—countries with consumer-facing certification systems and laws—are always labelled “responsibly sourced.” This promise, as our reporting in five countries shows, is misleading at least, and, in the worst cases, a lie.
We wanted to show how any gold certification scheme can be bypassed with little to no effort or creativity. We wanted to show that, no matter what the certification of origin and responsibility shows, no matter what the laws of the country of origin are, refining or consumption say, a large portion of the gold in our supply chain is of completely unclear origin.
We wanted to prove that even gold of clearly illegal origin—like gold that has been mined inside Guiana Amazonian Park, the EU’s largest national park, in the rainforest of French Guiana—can make its way to the most reputable refineries and companies.
We used a systems-based approach, trying to find the problems in laws, certifications, and standards that make an opaque, and sometimes criminal system possible, rather than individual actors or companies. What we found was: It is not only easy to bypass these barriers, it is easier to evade them than to abide by them.
The reason for this is a specificity in the gold trade, that has to do with recycling, and how recycling is defined, which became one of our two main findings in the systems-based approach. More on that later.
According to the LBMA, 53% of LBMA feedstock is “recycled.” But according to the World Gold Council, only 30% of all gold going through refineries every year is from recycled origin.
The numbers again don’t add up. How is the LBMA getting almost double the amount of recycled material that is in circulation worldwide? The suspicion was gold from small-scale gold mining is misdeclared as “recycled.”
We also found out how easy it is to misdeclare gold. There is no joint definition of “recycled” in the gold industry. Currently, the LBMA’s is “anything that is gold-bearing and has not come directly from a mine in its first gold life cycle.”
The gold processing country uses this “scrap” gold to make “recycling” bars. At that point, the origin of the gold becomes untraceable and loses its origin. This bar is then “clean” and goes into the world gold market as “recycled gold.”
When we began our reporting, our initial goal was to track down a single shipment of gold—from its origin to the refiner. We decided to start with a data-driven approach, looking for shipment trails in databases. Once we found promising leads, we planned to verify them through experts, sources, and company records.
The advantage of this method, we thought, was that we wouldn’t have to work the other way around—finding a source with a tip about a suspicious shipment and then trying to dig up the data to back it up. We believed that route would be even more difficult. Another reason we focused on data first was the idea that if we could successfully track one shipment, we might be able to find more from the same supplier or going to the same buyer.
But, we also knew that gold was uniquely hard to follow using online databases, whether public or private.
Knowing that, we tried the following databases: Panjiva, ImportGenius, etc., but found they did not work for tracking gold shipments as the relevant countries did not report this data.
