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The substandard gold bars account for as much as 10 per cent of the total non-SJC gold bullion sent to SJC to be converted into the national brand, the company said.
The discovery has greatly concerned holders of non-SJC gold bullion, as the gold bars with below-par purity will only be bought at the prices of the gold material, while the bars have reportedly been bought at far lower prices than the rates of SJC.
“Some producers were found to make gold bullion of only 55 to 57 per cent purity,” said SJC general director Do Cong Chinh.
The supervision board formed by the State Bank of Vietnam’s Ho Chi Minh City branch has reported the case to its superior, while SJC has also informed other gold bullion producers about the issue.
“No one posted any objection to our conclusion during a meeting in late October,” Chinh said.
The standard for SJC gold bullion was determined as late as 1990, under the Swiss standard, the CEO said.
SJC is committed to gold bullion that is always 99.99 per cent pure, he said, adding that the company has never cared about the quality standards of other producers.
“But with the central bank allowing non-SJC gold bars to be converted into our products, we have to pay close attention to the quality and purity checks,” he explained.
In response to the question of whether the gold bullion has lower purity because it is unclean, Tran Thu Anh, deputy director of the Tan Thuan SJC Jewelry Co, said it is a weak argument.
“There is a producer with 500 out of the 1,000 gold bars it sent to SJC for conversion failing to meet purity standards,” he said.
“So how could it be blamed on dirty bars?”
In response to SJC’s announcement about the below-par purity of gold bullion, many gold companies asserted that their products are 99.99 per cent pure.
“Our AAA gold bullion has relatively similar quality and purity to SJC products,” insisted Nguyen Thanh Trung, chairman of Agribank Gold.
Other producers also expressed their skepticism over the purity testing machinery of SJC.
“On which grounds are the SJC machines set as a norm for the testing, while our machines produce results showing that the gold bullion still meets standards?” one of the companies wondered.
SJC representatives said the testing and conversion processes are both done under the supervision of the central bank.
Meanwhile, the deputy director of a gold company in HCMC said the central bank in fact does not manage gold bullion quality.
“Prior to the nationalization of the gold bullion brand name, every qualified company could apply for the license to produce gold bullion,” he said.
Hence, there is in fact no Vietnamese standard for gold bullion, and some producers have in fact made gold bars of only 99.9, or 99 per cent purity, he said.