10 June 2009

Canadian Mint - $20m loss?

Extracts from the Ottawa Citizen 9 June:

On government orders, the Royal Canadian Mint has called for a criminal probe into as much as $20 million in unaccounted-for gold and precious metals at its Sussex Drive headquarters.

The looming police investigation comes eight months after the Crown corporation first learned it had lost track of the riches last October. It didn’t inform the government until the Citizen revealed the mystery last week.

An internal “precious metals reconciliation” project was initiated by the Mint last fall. In March, with that reckoning apparently no nearer to finding answers, an external audit was commissioned. Its findings are expected next week.


From the Ottawa Citizen 6 June:

NDP MP Pat Martin, representing Winnipeg Centre and vice-chair of the Commons' government operations committee, believes four months should have been ample time for the external audit to find an auditing or accounting problem.

Still, Martin thinks theft is the least likely explanation for the unaccounted gold.

"Given the sheer volume of activity lately, there could be some slippage and line loss in the processes. There could be some maladministration with the accounting systems and, in the worst-case scenario, somebody's figured out a way to slip some precious metals out of there, but that's the least likely of the three," he said.


Knowing the issues involved in precious metals reconciliations, I am doubtful that the police are going to be able to do any better unless the Mint has specific evidence/reasons of theft. I'll discuss why in my next blog.

2 comments:

Anonymous said...

Hi Bron, I wonder if anybody at the Canadian mint saw a James Bond film a few decades ago called Goldfinger. Worth a few laughs.

I recall that Bond's evil adversary Auric Goldfinger at one stage dissolved gold into a liquid (acid?) that was impregnated into his Rolls Royce cars upholstery so that it might be smuggled in and out of countries. I don't know if this is possible or just Hollywood BS... Myth Busters material?

Auric used a huge laser beam to threaten Bond's family jewels, thereby vaporising a big slab of gold, the sight of which would probably cause a mint manager heartburn ...but I digress.

If gold IS able to be dissolved into a slurry it could be flushed down into the Mint sewers and the liquid retrieved at a thief's leisure.

Sure it would be "crappy" work but it is a lot less work sorting out real nuggets from human ones than countless tons of hard rock.

It would not matter how many guards, guard dogs, surveillance cameras, guns or anti theft procedures were in place if all a thief needed was a municipal plumbing plan, a bottle of gold emulsifier and a BIG tank to collect the gold metal slurry obeying the laws of plumbing (basically gravity) and silently but surely making its way to its new owners.

FWIW

Aussie A

ps Perhaps my wife is right and I have too vivid an imagination?

Bron said...

No, what you propose is possible. The business of working with gold though is that you identify all these possible loss points and put things in place to stop the loss. For example, they have scubbers in the ducting to trap the gold that gets evaporated during gold pouring.

The thing is you can't lose that much gold via these ways as most mints/refineries have the key physical "traps" in place.