LBMA lawsuit Oct 7 could challenge gold certification process

[pmbug]

The London Bullion Market Association (LBMA) will defend itself in London's High Court from October 7 against a claim that it owed a duty of care to two Tanzanian artisanal miners allegedly killed at the North Mara gold mine in 2019.

The case marks a legal challenge to a 276-year-old system that determines which gold bars can be traded in London, the world's largest over-the-counter bullion market, testing whether it can be held responsible for alleged abuses linked to gold mining.

"A finding that the LBMA owes a duty of care of the alleged nature and scope would, without exaggeration, be an existential issue for the LBMA," the association, which manages the Good Delivery List of accredited gold refiners, said in its defence documents.

SUCCESSFUL CASE COULD SPARK FURTHER CLAIMS
In the case, law firm Leigh Day, representing relatives of the two artisanal miners, claims the LBMA was negligent in re-certifying a Good Delivery refinery that processed North Mara's gold in 2019 "in circumstances where such certification cloaked ongoing serious human rights abuses" at the mine.
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More:

https://www.miningweekly.com/article/centuries-old-london-good-delivery-system-for-gold-faces-modern-accountability-test-2026-09-28

If the LBMA loses, what percent of LBMA Good Delivery gold suddenly loses Good Delivery status? What percent of LBMA gold stock no longer becomes liquid for market trade/settlement?

 

[pmbug]

 

[Voodoo]

That doesn't look like a serious lawsuit to me but hey, what do I know. A $2.6 million legal bill is NOT going to put an organization like the LMBA into trouble.... naked short selling a bunch of shit would, however.

 

[pmbug]

IMO, the big issue isn't the cost of a potential judgement. It's the domino effect that having to decertify miners/refiners from the Good Delivery list would have on their existing vault stock.

 

[Voodoo]

I mean gold is gold... Perhaps just having a "good delivery" refinery is at stake. Threatening the system.

 

[pmbug]

I mean gold is gold...

...
LBMA’s Responsible Sourcing Programme (the Programme) protects the integrity of the global supply chain for the wholesale precious metals markets. It was set up to consolidate, strengthen and formalise the existing standards of the LBMA Good Delivery Refiners’ (Refiners) due diligence practices. LBMA was actively involved in drafting the OECD Due Diligence Guidance1 and its Gold Supplement and continues to support the OECD’s work in supply chain due diligence and related projects.

Vital to the credibility of the LBMA Programme is its broad scope, which includes measures to combat money laundering, terrorist financing and human rights abuses globally. In addition, the Programme has also been developed to recognise the increasing importance of strong Environmental, Social and Governance (ESG) responsibilities.

Responsible Sourcing Programme Overview

All LBMA Good Delivery List (GDL) Gold and Silver Refiners (Refiners) are required to implement LBMA’s Responsible Sourcing Guidance (the Guidance), which comprises the Responsible Gold Guidance (RGG) and Responsible Silver Guidance (RSG), and obtain annual independent assurance on their publicly available compliance reporting. Failure to appropriately adhere to the Guidance may result in a Refiner being removed from the GDL, following LBMA’s robust Incident Review Process (IRP).
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More:
https://www.lbma.org.uk/publications/responsible-gold-guidance-v9/about-lbma

 

[Voodoo]

We all know that's just a Pay to Play scheme. ie a monopoly.

 

[pmbug]

Well, that's what the lawsuit is all about. Either the Good Delivery list is as advertised (and therefore the LBMA has a duty of care in the certification) or they are exposed as frauds. If the courts rule to the former, the LBMA is going to be in a pickle with actually enforcing certification compliance and decertifying actors that don't make the cut. Our personal opinions on the issue aren't relevant to whether or not the LBMA might be forced to shrink the amount of their existing vault stock that meets their certification standards.