Irregularities rampant in local bullion market

KATHMANDU, APR 23 -Amid gold buying frenzy on the backdrop of price volatility in the last few days, some bullion traders have been found cheating customers, especially in weight and quality of gold and silver jewelleries.

On Monday, the government team comprising officials of Department of Commerce and Supply Management and Nepal Bureau of Standards and Metrology (NBSM) and police  seized weighing machines from jewellery shops in Kathmandu and tested samples for quality of gold and silvers products. The inspection was carried out amid complaints of black marketing and low-quality shortage of precious yellow metal.

A report of the quality test, carried out by the NBSM, shows customers are not getting the quality gold and silver products. Two jewellery shops—Shree Ganapati Jewelleries and RB Diamonds—were found using weighing machines without proper NBSM certification. Under the government rules, dealers must get their machines certified by the NBSM.

The report has stated that Shree Ganapati’s sample of gold earring only had 97 percent purity as opposed to the shop’s claim of 24 caret (99.50 percent), while its silver payal contained led. Similarly, silver products of RB Diamond and Tejmin Jewellers had mixture of copper and cadmium respectively, according to the report.   RB Diamonds was found selling silver bowl that contained 2 percent copper, and Tejmin’s silver product have as much as 7.07 percent cadmium.

During Monday’s market monitoring, the inspection team seized four weighing machines from Shree Ganapati and three un-registered weighing tools from RB Diamonds. The team also seized nine purchase and sales bills from Tejmin for investigation. Shree Ganapati was found selling diamond and golden jewelleries using weighing machines approved for only silver products, according to the NBSM report. And RB Diamonds was found using an un-registered weighing scale for selling diamond, which the report says has a difference of 14 milligram compared to standard weighing machine.

“We will also be checking the accuracy of gold price fixed in the local market, amount of gold sold by traders based on price fluctuation and actual quantity released by the commercial banks in the last 10 days,” said Narayan Prasad Bidari, director general at the Commerce Department. He also said that action will be initiated against those traders involved in illegal activities.

As it is the first time the government has found such wrongdoing in the jewellery market, the authorities concerned are yet to decide on action against those found guilty. “We do not have a clear law for this type of misdeed,” said Ram Adhar Sah, director general of the NBSM. “We will hold a meeting on Tuesday and decide the action under one of the two acts—Black Marketing Act or Consumer Rights Protection Act.”  

 Traders however, said that the government need to realise that the issue of adulteration in gold has surfaced mainly because of the supply constraint, leaving gold sellers dependent on whatever they get.