Royal Bank of Canada Appears Be Selling Counterfeit Gold Bars to Retail Customers

A recent report from the Canadian Broadcasting Company (CBC) has the potential to roil the physical gold market across the globe. According to the CBC, a jeweler named Samuel Tang recently bought a 1oz gold bar from a Royal Bank of Canada branch across the street from his boutique in Ottawa, and the sealed and certified bar was bogus.

These gold bars are generally used by small investors to gain access to gold in a form that is both easily recognizable, and of a known quality. When the jeweler gave the 1oz bar to his goldsmith to roll out, the goldsmith was shocked when he was unable to use his tableting mill to work the gold. He then tried to bend the bar by hand, and when it snapped, leaving a jagged edge, he knew something was not right.

It should come as no surprise then when the RBC “gold” bar was subjected to an acid test, it failed miserably. What is even more shocking is that when Mr. Tang approached both The Royal Canadian Mint, and RBC, they declined to help him resolve the situation. The jeweler then went to the CBC, and once the story broke, apparently the RBC found a more helpful stance.

Dirty Tricks

Fake gold isn't a new idea, when it is officially certified from one of the world's foremost refiners, it becomes terrifying. Equally upsetting is the reaction Mr. Tang received from both the RBC and Royal Canadian Mint, and given the recent security scandal involving the Mint, this situation casts some serious doubt on the efficacy of the quality control procedures there.

The thing is, the Canadian Mint is one of the most respected refiners on the planet, and as the buyer of the spurious buyer pointed out, the vast majority of customers would never violate the sanctity of a seal from the Canadian Mint.

It means something.

This creates major issues, and sadly for the mint, gold is only worth something if it is gold. There is no easy way to rectify this situation, and given the history of oversights at the Canadian Mint, the gold buying community has every right to ask some uncomfortable questions.

Trust?

For the moment, there is no way to know at what point the Mint's supplies of certified gold were compromised. But now they need to figure out how to restore confidence in one of the world's most respected precious metals refineries. There will of course be questions of conspiracy, especially given the nature of the instrument in question, and the likelihood that the bars would never be inspected by their buyers.

Much like “trading sardines”.

The upcoming Silver and Gold Summit in San Francisco on November 20^th and 21^st will be a perfect opportunity to learn from some of the smartest precious metals investors on the planet. This recent scare in the physical gold market only serves to hone the discipline of gold buyers, and today, there is nothing that can be taken for granted.

If you want to build up your knowledge of a market that is becoming more valuable all the time, be in the center of San Francisco on November 20^th. More information on how to register can be found here, and you can rest assured that every presenter has passed Marin Katusa's acid test.