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Perth Mint saw a spike in gold trading after the anti-money laundering scandal

Perth Mint saw a spike in gold trading after the anti-money laundering scandal
Perth Mint saw a spike in gold trading after the anti-money laundering scandal

The chair of the Perth Mint, Sam Walsh, has revealed that the institution’s gold trade has actually increased despite the negative spotlight it found itself in following a critical ABC report.

The report, which aired in March, exposed issues related to the Mint’s adherence to anti-money laundering rules enforced by the Australian Transaction Reports and Analysis Centre (AUSTRAC).

The Four Corners report also highlighted instances where gold bars the Mint attempted to sell to the Shanghai Gold Exchange were rejected due to impurities that did not meet the Exchange’s high purity standards.

In response to these revelations, a Senate inquiry was launched in July, leading to a public hearing in Perth. The Perth Mint, owned by the Western Australian government and the only government-owned and guaranteed precious metals enterprise, found itself at the centre of the inquiry.

During the inquiry, Sam Walsh emphasised that the Mint’s international reputation remained intact despite the media’s focus on its issues. He stated that the Mint’s trade actually increased during the intense media scrutiny, demonstrating the trust of their customers in the steps taken to address the problems.

While some reports showed a drop in the Mint’s gold sales in August, Mr Walsh attributed it to global economic fluctuations, emphasising that the gold market is inherently cyclical.

Notably, the Mint’s trade of gold dore (bars of mostly gold, some silver, and other alloys) did not decline after the Four Corners revelations. Perth Mint handles a significant portion of Australia’s gold dore intake.

Regarding the Mint’s handling of accountability issues, Mr. Walsh mentioned that Austrac reporting had since improved, as acknowledged by the WA Auditor-General. The Auditor-General, Caroline Spencer, stated that the Mint was in a better financial position than it was five years ago.

She noted that the Mint had taken on new markets, products, and customers without fully appreciating the associated risks and obligations, particularly regarding anti-money laundering and counter-terrorism financing.

The Four Corners report had highlighted an incident where Dayne Brajkovich, a former bikie, was able to purchase $27,000 worth of gold from the Mint’s gift shop with just a driver’s license as identification. Austrac rules dictate that customer information should be scrutinised to prevent gold from being used for illegal activities.

WA’s Mines Minister Bill Johnston assured the committee that Gold Corporation, the entity under which the Mint trades, had never been accused of involvement in money laundering. Both Mr. Walsh and Mr. Johnston asserted that the Mint’s reputation remained intact within the gold industry.

WA Liberal MP for Cottesloe Dr David Honey and Opposition Leader Shane Love also provided evidence during the inquiry. Representatives from Austrac also testified, albeit with limited information as their own review into the Perth Mint was ongoing.