At Least One Central Bank Held Fake Gold

Washington’s Blog
Tuesday, Nov 17th, 2009

Rob Kirby seems like a fairly respectable fellow. But I am thoroughly agnostic about Kirby’s claim that a large portion of the world’s gold has been cut with tungsten. Big claims require big evidence, and I haven’t seen it yet.

True, as Mike Hewitt points out, a Chinese company boasts about making gold-plated tungsten:

A coin with a tungsten center and gold all around it could not be detected as counterfeit by density measurement alone … We are well accustomed to exploit more innovative applications of tungsten products. Gold-plated tungsten is one of our main products.

But there is no evidence that gold-plated tungsten has been used as a counterfeit.

However, we do know that at least some gold held by central banks is fake. For example, as the BBC noted last year, some 90kg of gold held by Ethiopia’s central bank was really gold-plated steel.

Obviously, this is not a first world country or banking center we’re talking about. Ethiopia is one of the world’s poorest countries.

But the fact that any central bank has fallen for fake gold means – in a rational world – that a full audit of the gold holdings of central banks worldwide should be conducted.

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