Perth Mint doped its gold to save $620K a year, then hid the failed assays

The Perth Mint, the WA government-owned refiner that sold $20.3 billion of gold in 2022, began 'doping' its gold in 2018 — adding silver and copper impurities to sit just inside the industry)s 99.99 per cent purity standard — to save up to $620,000 a year. Within months, refinery staff flagged concerns that silver and copper levels could breach the stricter Shanghai Gold Exchange (SGE) limits. The doping continued anyway.

In September 2021 the SGE alleged two bars contained too much silver. An internal investigation, ordered the same day, found one of the bars had been 'red flagged) after failing the SGE)s silver assay — and that up to 100 tonnes of gold sold to Shanghai over the three-year programme was potentially non-compliant. Buying it back would cost about $8.7 billion at then-prices and could require WA taxpayer support.

Instead of disclosing, the mint concealed: the report says CEO Richard Hayes confirmed only the compliant assay would be sent to the customer, 'with the broader burden of proof to be left with the SGE). Governance advocate Serena Lillywhite called it 'a cover-up). The mint stopped doping the day the failed assay surfaced; Hayes announced early retirement that same week, citing illness. The SGE ultimately kept the complaint private and accepted assurances, with certificates of assay required on future bars.

Up to 100 tonnes of gold in Shanghai potentially non-compliant — an $8.7B buyback that could have needed WA taxpayer support — plus a reputation dent

Doping to the exact edge of the 99.99 per cent standard left no margin for the stricter silver limits of the SGE, the mint)s biggest client.

Refinery staff raised the silver and copper concerns within months of the programme starting, and doping continued regardless.

When the failed assay surfaced, the mint chose selective disclosure — sending only the passing test — to protect its accreditation and reputation.

The saving, roughly $620,000 a year, was a rounding error against $20.3 billion of annual sales and a government-guaranteed brand.

A $620,000 saving aimed a 124-year-old institution's entire trust premium at a minuscule purity margin — and once the test failed, hiding it converted a quality slip into a cover-up.

The SGE never made its complaint public, and the mint agreed all future bars would carry certificates of assay, saying refining had been enhanced since late 2021 and purity standards raised above industry average. It was the mint)s second recent scandal — the LBMA had investigated it in 2020 over gold bought from a convicted killer in Papua New Guinea, mined with child labour and cut with mercury, forcing a corrective action plan.