Article -11 Galamsey Fraud Gold Scam.
In this article, we will cover two areas where alluvial gold scam usually occurs, when buying gold from local miners in the villages and when one invests in galamsey mining operations.
First, we begin with when buying gold from the villagers who mostly appear to look innocent but have the clear intentions to defraud gold buyers. What they do is, they usually mold the particles of gold into gold stones or nuggets unrefined to sell at a lesser price for the buyer to take it to the refinery to burn it into pure gold for the gold buyer to sell to the refinery. The buyer weighs the gold stones or nuggets with an electronic scale and buys per kilogram or per grams.
The Locals would insert stones inside the unrefined gold that might weigh up to 100 grams, whereas the actual weight of the unrefined gold is only 20 grams and you will arrive at the weight of 120grans of unrefined gold mixed with stones.
This is where the hammering gold testing method becomes very useful, by the time one hammers the gold instead of taking a smeared shape it breaks into fragments because it contains stones and the seller's fraud is uncovered.
The second area of scam is when a buyer invests in a galamsey mining operation. The locals have the mine leased or owned and they also have their mining materials the washing board and mat while the buyer invests in purchasing some of these materials including water pumps and water hoses for the mining operation. In any case, there is an agreement reached based on the amount invested in the mining operations the local miners then sell to the investor at a discounted price with the understanding that all the gold processed in the mine will be sold to the investor who is also the buyer.
The local miners would come to the mine with two gold mats, they would use one mat to catch gold for about 4 hours or more and keep the first mat for themselves and turn in the second mat for the final hours of the mining operation for the day. At the end of the day's operation, they would only turn in gold recovered from only one mat and hide the other mat, they would go home with the other mat, recover the gold from the mat and sell it to another buyer at a much higher price whereas, the investor only has half a days work of gold processed, what a huge loss after investing so much only to be defrauded of his investment. So for an investor to reduce these fraudulent activities the rule is, that every miner entering the mine must come in empty-handed, without any mining equipment only provided and thoroughly supervised by the investor, that way, such shading activities would be curtailed for the ultimate benefits of the investor.
In the next article, we will discuss the Principles to adhere to when buying gold and one more is how to test a gold bar.
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