Perth Mint insiders say the refiner has ignored staff concerns about dealing with Golden Valley, which buys from small-scale miners, an industry heavily criticised for using child labour, degrading the environment through the use of toxic mercury, and promoting conflict.
The insiders, speaking on the condition they remain anonymous, said the mint was paying little more than lip service to its pledges around responsible gold sourcing by continuing to deal with Golden Valley.
They cited a conversation with a Golden Valley employee, who was asked how the company dealt with competition in PNG.
"It's easy, a gun to the back of the head," the employee said. Golden Valley denies a comment like this was ever made.
Any sanctions from the LBMA would be highly damaging for the Mint, which has repeatedly claimed to be at the "forefront of setting the highest possible ethical standards".
LBMA responsible sourcing accreditation has allowed the Mint to put its name to exchange traded funds on the ASX and the New York Stock Exchange, which have won approval from ethical investment managers.
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"This situation leads to significant questions and ultimately doubt around the efficacy of the LBMA's responsible sourcing policy, which responsible investors no doubt rely upon," he said.
Under the LBMA's
responsible sourcing policy, refiners such as the Perth Mint commit to not buying gold which promotes conflict or human rights abuses, including child labour, and is sustainably sourced.
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Failure to adhere to the LBMA's responsible sourcing program will result in the removal of the refiner from the good delivery lists," the LBMA's chief technical officer, Neil Harby, said in a video explaining the policy.