The problem of fake gold bars (2012)(blogs.reuters.com)
blogs.reuters.com
The problem of fake gold bars (2012)
http://blogs.reuters.com/felix-salmon/2012/03/25/the-problem-of-fake-gold-bars/
14 comments
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Update: I forgot that gold is actually used, once in a while, to make things like jewels — which means that bars are melted down pretty frequently. If there was [sic] a significant number of salted bars out there, we’d know about it, since you’d notice when one of them got melted down. Which isn’t to say that there are no salted bars at all, but it certainly does seem to imply that there’s [sic] nowhere near 1.3 million of them.
That is, unless it's the owners of gold reserves who are salting their own bars to inflate their apparent net worth.
I wonder if the acoustical properties of a fake bar would be easy to distinguish from solid gold.
I wonder if the acoustical properties of a fake bar would be easy to distinguish from solid gold.
Probably. Acoustic velocities in tungsten are quite a bit higher than in gold. See http://en.wikipedia.org/wiki/Speeds_of_sound_of_the_elements...
It should be straightforward to make an acoustic time of flight go/no go meter you could place on a gold bar. Piezo excitation transducer/fixed distance/piezo receiver/process signal propagation velocity -> light up red or green light.
It should be straightforward to make an acoustic time of flight go/no go meter you could place on a gold bar. Piezo excitation transducer/fixed distance/piezo receiver/process signal propagation velocity -> light up red or green light.
According to those numbers for a ~10cm bar you'd need ~1 microsecond resolution, or more depending on your tolerance of the tungsten mixture (for 1% tungsten-platinum alloy substitution you'll need ~10ns resolution).
I'm not sure this is easy to achieve! A best case commercial speaker/microphone will have a ~100khz bandwidth, which gives ~10 microsecond resolution. If you're aiming for high accuracy you also need to account for thermal variations in speed of sound, which would require a some precise thermometers.
I'm not sure this is easy to achieve! A best case commercial speaker/microphone will have a ~100khz bandwidth, which gives ~10 microsecond resolution. If you're aiming for high accuracy you also need to account for thermal variations in speed of sound, which would require a some precise thermometers.
I suppose don't use a speaker/microphone then. Use a laser reflected at an angle off the bar to an optical transducer and strike the bar. Watch for the initial strike and the reflection. The time domain is nothing for a dedicated CPU such as the 64MHz one I use in my projects. If the only issue is sensing the phenomenon, I'm sure something could be devised.
Just do what Archimedes suggested. ;)
What, run up and down the street naked, yelling Eureka?
Actually, I'm agreed that you could measure the density, but somebody could fiddle with the density too by adding just a touch of this or that to bring everything up to the right weight.
Actually, I'm agreed that you could measure the density, but somebody could fiddle with the density too by adding just a touch of this or that to bring everything up to the right weight.
You could always take small core samples and run them through mass spec.
You suggest to drill every gold bar, thus ruining the certification?
Random sample. I'm not familiar with gold bars, but I imagine that there are procedures for this (like rectifying at a new weight or recasting the sampled bars). A few milligrams of gold shouldn't be a big deal unless we're dealing with gold fever.
If you're willing to melt them down though, you probably don't have to deal with mass spec as some property will have to give (melting point, density, etc).
If you're willing to melt them down though, you probably don't have to deal with mass spec as some property will have to give (melting point, density, etc).
Where 'this or that' can only be something more dense than gold, which are not cheap: http://m.wolframalpha.com/input/?i=10+densest+elements
Aha, I didn't look up the densities.
You can't determine if the gold bar is salted by only measuring its density. It's pretty easy to create a mix of gold, tungsten and osmium to have the exact same density as pure gold.
If I was a bank dealing with standardized gold bars, I'd make a machine that validates a bar at the push of a button. Surely they have that, given that a single 40 Oz bar is worth $800,000.
"If you can weigh the bar accurately, then you can test for purity by essentially dropping it in a bucket of water and seeing how much the water level rises: a gold-covered tungsten bar will displace more water than a pure gold bar. "
I'm afraid that either myself or the author doesn't fully understand fluid displacement.
I'm afraid that either myself or the author doesn't fully understand fluid displacement.
Gold density is 19.30 g/cm3, Tungsten is 19.25.
Given two gold bars, one adulterated with Tungsten, and one not, either the weight will differ or the volume will differ. So, given equal weights (i.e. standard 400oz bars), you can check the displacement to establish purity.
If you use a container that is filled up to a spout, and you measure the displaced water by collecting it in a measuring cup, you can just directly calculate density, and then compare it to gold.
Given two gold bars, one adulterated with Tungsten, and one not, either the weight will differ or the volume will differ. So, given equal weights (i.e. standard 400oz bars), you can check the displacement to establish purity.
If you use a container that is filled up to a spout, and you measure the displaced water by collecting it in a measuring cup, you can just directly calculate density, and then compare it to gold.
you can't just check density like that, come on. platinum (which apparently trades around the same price as gold) - has a density of 21.45 [1] which more than compensates. If you want 100 grams of a tungsten-platinum mix to match the weight/volume of 100 grams of gold, this is how many grams you get to use of tungsten:
19.3 * 100 = 19.25 * x + 21.4(100-x)
gold is left, mix is right (a sum of the tungsten and platinum parts). I solve for 100 grams because voila, it's now a percentage. That solves to x = 97.7273 (you get to use 97.7273 grams of tungsten) or you just need 2.2727% platinum. (which recall costs about the same as gold.) so if this were a great test people could just use an alloy, which apparently exist:
https://www.google.com/search?q=tungsten+platinum+alloy
and target the exact same density as gold. tungsten alone seems close enough for them, at least, according to the author.
[1] http://en.wikipedia.org/wiki/Platinum
19.3 * 100 = 19.25 * x + 21.4(100-x)
gold is left, mix is right (a sum of the tungsten and platinum parts). I solve for 100 grams because voila, it's now a percentage. That solves to x = 97.7273 (you get to use 97.7273 grams of tungsten) or you just need 2.2727% platinum. (which recall costs about the same as gold.) so if this were a great test people could just use an alloy, which apparently exist:
https://www.google.com/search?q=tungsten+platinum+alloy
and target the exact same density as gold. tungsten alone seems close enough for them, at least, according to the author.
[1] http://en.wikipedia.org/wiki/Platinum
Yeah this looks viable. This would make the best fake bar. I don't think the metal even need to be alloyed, you can just pour in one first, then the other.
I didn't mean it to be a viable suggestion - I don't think it is one. If you're testing density to within 2.7% you are doing other tests (suggested elsewhere by others in this thread). All I was saying is that although I do think the author is wrong (there is no problem of fake gold bars), the existence of a simple density test isn't why...
yeah, this machine seems to be able to do it: http://www.ebay.ca/itm/GoldXpert-SDD-Portable-Countertop-XRF...
The first sentence of the original article states that XRF won't tell you if the core of the bar has been replaced with a different metal: "You don’t need to be a conspiracy theorist to find this worrying: a 1kg gold bar, certified as 99.98% pure by XRF (X-ray fluorescence) tests, turns out to have been drilled out and largely replaced with tungsten"
The article also says that a micro-ohm meter can detect such replacement.
The article also says that a micro-ohm meter can detect such replacement.
Assuming you can figure out how to pour tungsten, or have something to pour it into.
You could match the density with an alloy of a denser metal than gold. Lead - tungsten maybe?
At least one of the metals in the alloy would need to be higher density than gold. There are a few but I don't think any of them are easy to get: http://www.wolframalpha.com/share/clip?f=d41d8cd98f00b204e98...
EDIT: tungsten + platinum looks viable as sibling comment mentioned.
EDIT: tungsten + platinum looks viable as sibling comment mentioned.
Oops! I just assumed lead was denser than gold without checking! I didn't realize how dense gold actually is.
I don't know anything about this case, but it could be there's a bunch of air trapped inside the bar with the tungsten, assuming the forgers didn't alter the outside dimensions of the bar.
bar with tungsten is larger than pure gold bar. so air will not help here.
Not if you start with a gold bar, then hollow the core out like a Twinkie and fill it with tungsten and the plug the end. Which I believe is what gbhn was implying.
Then the bar is not heavy enough, because you've run out of room to add tungsten on the inside, and adding it on the outside would change the volume or shape of the bar.
Tungsten is less dense than gold. Not as much a difference as actual twinkie filling, but either way you're stuck with a similar issue.
Tungsten is less dense than gold. Not as much a difference as actual twinkie filling, but either way you're stuck with a similar issue.
Say you found your $100M worth of gold is salted. I am guessing you wouldn't advertise it in public too eagerly. You'd probably want to offload it and turn it into some other asset as soon as possible and make it someone else's problem.
I suppose that depends on your ethics… Though most people's ethics would be tested when it comes to $100 million. Hopefully, anyone discovering fake gold would file a lawsuit or report the fraud to law enforcement.
Selling a gold bar you know is fake would be very unethical indeed. However I could imagine people would avoid testing gold they already own, as nothing good can come of it.
One option is to only buy directly from a government owned mint that pours its own bars. e.g. http://www.perthmint.com.au/investment_bullion_bars_coins_ba...
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This article would be more useful if it contained any sort of facts about or reasonable estimate of what the frequency of fake gold bars may be.
As a glass flameworker, I and my colleagues buy gold, cut it up, stick it on rods of glass, and put it on the flame to deposit gold vapor onto glass. We would notice fake gold right away, but I haven't heard of that happening.
(Though, the typical flameworker doesn't buy whole 1kg gold bars!)
As a glass flameworker, I and my colleagues buy gold, cut it up, stick it on rods of glass, and put it on the flame to deposit gold vapor onto glass. We would notice fake gold right away, but I haven't heard of that happening.
(Though, the typical flameworker doesn't buy whole 1kg gold bars!)
Or just buy gold coins. Buy some Krugerrands, some Maple Leafs, some Double Eagles, etc. Yes they can also be fake, but what are the odds that you'll buy fakes of all those different coins?
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This same problem happened to the Ethiopian central bank. One batch, which had been bought from a trader, was discovered to be fake fairly quickly; another batch of faked gold, seized from smugglers, had been in their vaults for years.
http://news.bbc.co.uk/2/hi/africa/7294665.stm
http://news.bbc.co.uk/2/hi/africa/7294665.stm
Well, banks are not stupid, and it is cheap for them to certify gold bars in quantity.
There are certification authorities that do exactly that. Here in Spain you can hire them, and they will melt the gold in front of you and use expensive instrumental to know how much gold a gold bar has.
We also have the concept of "notary" that is a person whose job is to certify something by law. They are trustworthy.
It is individuals who should be afraid of being tricked. But you have at your disposal cheap microbalances, micro ohm meters(I made myself one for like USD30), 3d scanners(to calculate the volume as using water is tricky because surface tension of water), quartz transducers to measure speed of sound.
There are certification authorities that do exactly that. Here in Spain you can hire them, and they will melt the gold in front of you and use expensive instrumental to know how much gold a gold bar has.
We also have the concept of "notary" that is a person whose job is to certify something by law. They are trustworthy.
It is individuals who should be afraid of being tricked. But you have at your disposal cheap microbalances, micro ohm meters(I made myself one for like USD30), 3d scanners(to calculate the volume as using water is tricky because surface tension of water), quartz transducers to measure speed of sound.
Ah! An area where bitcoin is superior to gold!
The bigger worry should be the paper market. It's speculated that governments buying huge quantities of physical gold will sell non-existent gold on paper to keep the price of gold stable during their purchase.
I'd be more worried that your gold bars weren't actually in your bankers vault anymore. Look what happened when Germany tried to repatriate their gold from the U.S. Federal Reserve.
They didn't "try", they are doing it, partially, piecemeal.
Which may be because the Fed didn't actually have all that gold available, nicely separate in a vault labelled "Germany", but even if that is true, the case is rather more complex than just "The Fed embezzled the gold that Germany gave them for safekeeping". Because Germany never gave that gold - they never actually had it. It's in fact the German export surpluses from the time before the USA went off the gold standard.
Which may be because the Fed didn't actually have all that gold available, nicely separate in a vault labelled "Germany", but even if that is true, the case is rather more complex than just "The Fed embezzled the gold that Germany gave them for safekeeping". Because Germany never gave that gold - they never actually had it. It's in fact the German export surpluses from the time before the USA went off the gold standard.