Demand for gold in the Czech Republic is growing. How to tell the real from the fake?

Although the price of gold is breaking one record after another, the stock of the precious metal in Czech households is increasing. Gold is considered a safe investment - but that's only true if you buy the right one.

In recent years, there has been an increase in the incidence of counterfeit gold bullion in the Czech Republic. This trend is related to the increased demand for investment gold caused by rising inflation and economic uncertainty. "The reason for the increased incidence of counterfeit gold on the market is simple - increasing market demand coupled with increasing volumes of gold sales. Once something starts trending, there are always scammers who try to dishonestly profit from the trend. Bargains are suspicious. There are no bargains or discounts on precious metals. If someone is offering gold below the normal market price, that's a warning sign that something is wrong," He pointed out Roman Pilíšek, economist and co-founder of the company Golden Reserves, which has been operating on the Czech market since 2010.

Although it is not a mass affair, counterfeit gold bars do appear in the Czech Republic. Dealers encounter them several times a year. "For example, at the beginning of February this year, a middle-aged man came to us and offered to sell us a 100 gram gold ingot of the Münze Österreich brand. The ingot was the exact weight, and at first glance, to the layman, it did not look fake. But on our instruments we immediately identified the difference in metal. We advised the man to contact the Czech Police," Pilíšek described.

Gold is one of the 10 heaviest metals on the planet. It is therefore unusually heavy for its size, while counterfeits are usually slightly lighter. "For counterfeiting in terms of weight, tungsten is the closest. Counterfeiting with other metals, which are close to gold in weight, is economically unprofitable, since the acquisition of metals such as uranium, plutonium, neptunium or osmium is industrially, economically or legally very complicated, practically impossible or highly risky for the ordinary person. The base metals that are also used to counterfeit gold are considerably lighter. The ingot of real gold takes the form of a very thin plate. A gold-plated ingot of base metal of the same weight is likely to be longer and taller than a genuine ingot. You have to weigh it really carefully, as the differences can be in tenths or hundredths of a gram. When making any purchase, we recommend that you ask for authentication on the specialised equipment available to the professional dealer," Pilíšek said.

The place where you buy gold also greatly reduces the risk of buying counterfeit. "There are several steps to avoid buying fake gold. One should always buy from a dealer who has been in the market for some time. The first purchase should ideally be made at his brick-and-mortar shop. Check independent references. Any reputable dealer will be happy to guide you through the process of buying investment gold and silver and will always be willing and able to have the products in question checked by measurement on certified equipment, which an experienced and professional dealer always has available. We, for example, include a Certificate of Authenticity with every bar and coin - each piece individually we're remeasuring. Never shop in public markets, parking lots, bazaars or stock exchanges. When shopping on e-commerce sites, monitor whether the seller has contact information, terms and conditions, responds to communications, and has publicly available documents regarding the business," Pilíšek recommended.

In particular, beware of dubious online traders or internet bazaars. "A significant amount of inauthentic ingots is registered in the eastern e-shops. Personally, however, I would not even call them fakes due to their low quality. They are rather imitations, replicas and mock-ups, which are made of common metals and are thus easily identifiable," Pilíšek described.

If you decide to buy gold online, be cautious when you receive your shipment. "Ideally, it is a good idea to carefully check the integrity of the packaging before taking delivery, not to underestimate any suspicions, not to take delivery and to contact the supplier. If everything is fine at first glance, we recommend unpacking the parcel in a suitable safe place with sufficient light and recording everything with a mobile phone. In case of suspected counterfeit, contact the Czech Police immediately and follow their instructions." Pilíšek said.

There is no gold product on the market that has not been counterfeited in the past. So deciding between buying a whole gold bar or splitting the investment into smaller weights will not protect the investor from fraudsters. "Professional counterfeiters focus both on 250-gram ingots, where high profits can be expected, and on the production of metal imitations in low weights. For example, we observed a discrepancy in the weight of a 10-gram ingot, where the difference was 0.2 grams. The ingot was not damaged and was already produced with this deviation - it was thus made of real gold, however, it did not correspond to the declared weight. However, a layman has no chance of noticing such a discrepancy, so the only certainty is to buy from proven and reputable dealers." Pilíšek concluded.

pearmedia/ gnews.cz - RoZ