Friday, 30 May 2014 00:00
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At present fraudulent activities are on the increasing trend. We hear about computer frauds daily. Several people had lost their money on the purchase of house and property on bogus title deeds which are prepared in connivance with some officers in the Land Registry. A lawyer admitted to me that it is a very difficult task to identity genuine title deeds.
Now we hear of gold jewellery frauds, banks, finance house, pawn brokers, etc. had been cheated by accepting bogus gold jewellery (chains, bangles, rings, etc.). This fraud is normally revealed when banks, etc. try to auction unredeemed jewellery. In India several people had lost their money by purchasing gold jewellery on auction.
I understand that there is an organised gang which is involved. In this racket:
Thick gold mould is made on the jewellery with silver copper metals underneath. It is not possible to detect by more scratching. The jewellery has to be cut for proper detection.
Extra metals silver and copper are kept underneath so that weight of the item is perfect and not alarming.
There are incidents where people borrow jewellery and return later with bogus items which have the same appearance and weight. Owners get into trouble when they pledge same to banks, etc.
A lawyer friend had told me an interesting story. A lady had pledged gold jewellery in a bank and had obtained millions of rupees as loan. After some time the bank (say four to five months) had detected that the jewellery was fake and had advised the lady to replace it good jewellery.
A lawyer had argued in the courts that since the bank had accepted them as genuine, fraud could have been committed at their office and therefore the lady should be given proper gold jewellery as replacement. This case was won.
I understand that valuers of the banks are also sometimes involved in the racket. Therefore I appeal to dealers in gold items to clarify this problem for the benefit of public at large or otherwise the gold trade will come to a standstill.
S.R. Balachandran BSc.FCA, FCMA
