Sterling Silver, the investigation continues.
Posted By: Tony D.
Date: 9/5/2002 at 14:21:59
Sterling Silver Fraud is international in scope!
Sharefin wrote:
Recently received emailPlease feel free to circulate.
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Hello Mr. Laird,
It is a pleasure to email you - especially over such an important matter. I would like to add a comment or two to emails that were posted by Bill Murphy at his GATA web site on the on-going sterling silver fraud. I was the one who broke this story in late August at the Eagle Ranch web site forum. Two of the people I first informed about this were my brother, Ted Butler and Bill Murphy at GATA. You saw my initial post of this, I presume, on the GATA web site. There has been considerable ensuing discussion about this on Eagle Ranch forum and I would urge you to read them in the archives over the past week or so.
If you do so you will find that I have formerly contacted our (Canada) Competition Board for action in this matter. FYI I include an amended copy of the letter:
********snip
To whom it may concern,
Recently, a major international fraud in sterling silver products has come to my attention.
This fraud extends throughout the United States, Canada and Europe. The nature of the fraud involves misrepresenting a marked sterling standard of 925 parts of silver to copper with wares that are only silver plated. The majority of this "sterling" ware was found to be fraudulent in that the bodies of the items (excluding clasps, in chains that have a small piece of spring steel present) were found to be somewhat magnetic. Sterling silver is NOT magnetic to any degree whatsoever. From the degree of magnetism one is to suspect that the main metal involved is nickel (possibly, but not probably cobalt). I first discovered the problem with a heavy "sterling" bracelet that I purchased in a jewellery store last January. Wear on this "925 sterling" bracelet revealed silver plate on a duller, very slightly more yellow silver coloured metal that was harder than silver. This visible evidence again revealed silver plating over another metal. Please note that I am also familiar with rhodium finishes used on some sterling jewellery.
I discovered this problem in August of this year while in northern Ontario doing field work [in botany]. Within the week I visited Timmins, Ontario and a local mall there. The mall had two jewellery stores and a [W-M] department store. One of the jewellery stores would be what one would call term 'high-end'. I checked their stock of men's necklaces and bracelets and found the majority of them to be magnetic. I should point out that these magnetic findings ALSO included the majority of large sterling chain merchandise in the [W-M] store.
When I arrived back home in southern Ontario, I checked the sterling bracelets and necklaces in a local town's only jewellery store. Again, the majority of the stock tested positive with the magnet.
As I am actively networked on a daily basis with numerous individuals that have varying degrees of expertise in precious metals (most of these individuals were U.S. citizens), I was able to elicit a good responses and several took the time to visit local jewellery shops and/or test their personal jewellery in their respective areas. They in turn contacted others who undertook this simple survey. The results were the same as I found for those that did this in the United States and Europe and a few expanded their search to earrings etc. Problems were also found in this area as well, although the extent is unknown.
What is inferred by this 'spot testing' campaign is that at minimum it would be more difficult to find men's sterling chain jewellery that is not fraudulent in purity in every jewellery store, department store (including W-M) and mall kiosk in the United States and Canada than jewellery that is present that is real sterling product. The majority of this merchandise is apparently made by one manufacturer and imported. [I have since checked other outlets for sterling merchandise - even to the extent of visiting a yard sale, flea markets and collectible shows. In every case I found suspect magnetic jewellery that varied in frequency in each retail establishment from 20% to 80% of the sterling chains checked. The yard sale (and two booths at a flea market) revealed ALL items to be magnetic and consisted of "sterling charms" - with no indication of source of manufacture. All the chains were of newer manufacture, and yard sale charms were owned for three years.]
All suspect jewellery found with the exception of one reported to be from Singapore are marked 'Italy".
In every instance it is marked '925' and marketed with signs near or on the box as 'sterling silver'.
Anecdotal evidence would seem to indicate that this problem is growing. I say this because two years ago I bought a sterling chain marked 925 and "Italy" and it tested out to be real sterling silver. I have since found that these chains, identical in style and size can now be found to be magnetic.
This would indicate that old 'good' sterling has been sold off gradually and is now being replaced by fraudulent product.
The reason I have been on the watch for this sort of thing is two-fold. I am a collector of sterling and have studied the supply fundamentals of silver mining and its role in the financial markets price 'fixing' for years. The official (visible) above ground supplies of silver are all but depleted world-wide and most assuredly there is an increasing problem for commercials to find their silver bullion raw material. That fraud would surface was almost guaranteed and I have been watching for it - as another sign of severe supply deficits. That this was going to happen as an 'end phase event' was, for me, predictable.
But this has nothing to do with your mandate in this problem; it just serves to give you some background in my motivations for reporting this to you.
You have a very great scandal on your hands that is going to provide considerable disruption to consumers and retailers alike.
Finally: I have found on the net a manufacturer of sterling chains that would appear to be a manufacturer of this jewellery style. I , of course, have no idea whether or not these designs are patented and unique only to this manufacturer, but at the very least it will provide pictures of product that is suspect - in style. Again, I am not accusing this company of wrongdoing. One of the style forms of these chains (for example) is called "flat marina". As a rule retailers are not aware of the manufacturer, only the distributor.
http://www.[deleted].com/
I close with my final point that you may or may not have gleaned from my words. This fraud is an international one that impacts very seriously on the whole retail jewellery industry. This is a systemic problem of grave proportions. I invite you to investigate this aggressively. It should not even involve that much field work by your staff. Simply send a staff member to a local jewellery store that sells mass merchandise in sterling silver jewellery wares.
Please respond to this email and verify that it has been read. If it is not against policy to do so, please keep me informed of your findings.
Best regards,
*****unsnip
Another comment posted in the Bill Murphy James Joyce issue states that nickel (which is, as you know, weakly magnetic) is also used to plate sterling. I submit, based on PERSONAL experience that the plating material is the silver (is quite soft and is readily scraped off) and reveals a silvery duller metal underneath that most assuredly does not have the right hue AND is very much harder than any silver I have ever seen. Rhodium is, as you may also know, a silvery precious metal that is often used on sterling jewelry because it does not tarnish. The use of this metal is perfectly legitimate - although it has a very slightly different hue to it from silver also. Rhodium is not magnetic, of course.
No, the fraud involves [silver] plating over another metal, most likely nickel, (steel in the smallest braided chains), and this fraud is very huge, indeed.
Note: when checking for magnetism please try to keep gravity out of the equation. Make sure the chains are vertical in orientation and free-hanging when one draws close the magnet.
The public reactions of those with an interest in the precious metals markets over this situation (and some of the information errors that are also being posted by others) would seem to require it additional attention. I invite you to post this email, if you feel the importance warrants it.
Best regards,
Galearis |
