Hallmarking 9K gold in the USA

Jewelry Discussion
41 
I find it interesting that the hallmarking debatein the UK is
being presented as consumer protection for the average guy, as if
it was such enlightened, progressive and benevolent government
policy when medieval kings introduced it as a means to audit their
treasuries. As Willis Hance has pointed out with some slick
word-smithing you can still keep within the letter of the law and
still flim-flam the uninformed consumer into thinking gold plate
contains some serious precious metal value that might be a good
investment.

Stephen, the reason that it’s presented as protection for the
average guy (or girl) is because that’s what it is. It might have
been introduced in the 14th century to protect the wealthy, but
there have been various acts passed by parliment in the intervening
600 years, and the system is now entirely for the benefit of the
consumer. Manufacturers don’t gain anything from it, and the
super-rich don’t need that sort of protection - they would easily
afford to have items XRF tested if there wasn’t a hallmark.

Carats are an increasingly outdated system - dividing alloys into 24
parts used to be a good way of working with metals, because 24 can
be divided by 1, 2, 3, 4, 6 and 12, but modern scales and the advent
of decimalisation have removed the need for that sort of
measurement. In the UK, we now use a system of fineness marks,
expressed as “parts per thousand” of precious metal content (the
remainder being metals of a lower value, like copper). There are
fineness marks in place for 9ct, 14ct, 18ct, 22ct and “fine
gold/silver/platinum” (999), which are clearly traditional alloys,
but all of the new alloys, like 500 palladium or 850 platinum exist
to give flexibility for alloys of different working properties,
rather than because of any traditionof alloys with that fineness.
You will never see a carat mark as part of a hallmark on modern
items, although some manufacturers do put carat or fine ness stamps
on items for their own stock management.

Jamie Hall
http://primitive.ganoksin.com

42 
That could open up some interesting problems, or do you find not
being able to stamp a problem, an inconvenience, or not important?

I do not stamp some pieces as well. Sometimes simply because there
is no place where to stamp. It is only a problem if client does not
trust the goldsmith. But if there is no trust, there is no
relationship.

Frankly, metal is the last place for a client to worry. Stones
present much greater opportunity to get screwed, and there is not
stamps there. GIA certificates are meaningless, because how does one
know, that certificate is not a counterfeit.

The biggest screwing is in craftsmanship. Metal, value of stones,
simply does not matter if stones are falling out, and thing gets bent
out of shape every time you wear it. So you see, stamps are really
irrelevant, if there is no trust.

Leonid Surpin

43

I dont stamp it as it does not fit within the stamping regulations.

That could open up some interesting problems, or do you find not
being able to stamp a problem, an inconvenience, or not important?

Most of my customers either don’t care or understand the issue once
I explain it to them.

James Binnion
James Binnion Metal Arts

44

In the law 16 CFR 23.4 it states gold can not be less than 10k. ©
The following are examples of markings and descriptions that are
consistent with the principles described above: (1) An industry
product or part thereof, composed throughout of an alloy of gold of
not less than 10 karat fineness, may be marked and described as Gold
when such word Gold, wherever appearing, is immediately preceded by a
correct designation of the karat fineness of the alloy, and such
karat designation is of equal conspicuousness as the word Gold (for
example, 14 Karat Gold, 14 K. Gold, or 14 Kt. Gold). Such product may
also be marked and described by a designation of the karat fineness
of the gold alloy unaccompanied by the word Gold (for example, 14
Karat, 14 Kt., or 14 K.).

Val

45 
Stephen, the reason that it's presented as protection for the
average guy (or girl) is because that's what it is. It might have
been introduced in the 14th century to protect the wealthy, but
there have been various acts passed by parliment in the
intervening 600 years, and the system is now entirely for the
benefit of the consumer.

Jamie, I do not expect to change anyone’s mind in the UK or Ireland
about this issue. The responses to the comments online must be
running about 100 to 1 for keeping it as it is. Some even suggesting
that somehow the system should be exported to the rest of the world.
The reason I know about this is that I am registered and the Assay
Master sent me an e-mail trying to gin-up support for keeping the
system. You can add your opinion at

http://www.ganoksin.com/gnkurl/jr

I find it amusing that you guys have no problem imagining that many
in your own trade would instantly jump on the opportunity to cheat on
metal quality without assay. But that you find it impossible to
imagine your own benefit without it. Here in the US, as in most of
the rest of the world, you can make something, mark it yourself and
hand it right over to the customer without anyone else being
involved. Don’t you see that this saves you time, money and often
means you can get a sale that you might not have if you had to wait a
week for assay? I have had this conversation with many UK jewelers
and not very many are jealous of my freedom.

It also seemed a bit funny to me, back when metal prices were
cheaper, that small silver jewelry could have more cost associated
with shipping to and from assay and the assay charges, than the
actual melt value of the piece. Let’s pay a pound to make sure the
consumer isn’t cheated on 50p worth of silver! I know that pieces
under 5 grams or something like that are exempt, but the craftsmen I
deal with can’t even accept that small freedom without feeling like
it is wrong.

But, it is your system and most of you are obviously happy with it.
So carry on. But if you want to argue that OUR law against 9K gold is
sort of stupid, I will be glad to agree.

Stephen Walker

Andover, NY

46

Leonid - that’s where true professionalism comes in. When my name is
on something I make, whether stamped or not, that is what is
precious to me. If I lose that in my work, I lose everything.

47 
(1) An industry product or part thereof, composed throughout of an
alloy of gold *of not less than 10 karat fineness,* may be marked
and described as Gold when such word Gold, wherever appearing, is
immediately preceded by a correct designation of the karat fineness
of the alloy, and such karat designation is of equal
conspicuousness as the word Gold (for example, 14 Karat Gold, 14 K.
Gold, or 14 Kt. Gold). Such product may also be marked and
described by a designation of the karat fineness of the gold alloy
unaccompanied by the word Gold (for example, 14 Karat, 14 Kt., or
14 K.).

When I started my business, I asked a buddy of mine, who was
attending law school, to get me duplicate set of books, that he was
studying from. I never wanted to be a lawyer, but I felt that it is
important to know, when your lawyer is screwing you, so I acquainted
myself with rudiments of jurisprudence, so to speak.

One thing I learned is that quoting of laws should be left to
lawyers. There is a huge difference between normal communication and
the way lawyers think and speak. Let’s take the above example. Last
sentence begins with “Such product may also” Whenever legal language
contains word “may”. In legal thinking use of may, also means may
not, or don’t have to, or optional, and… Let’s look at the
beginning of the quote - "An industry product " Question arises right
away - what is the definition of industry product ? “or part thereof”
use of “or” implies flexibility of interpretation. “composed
throughout of an alloy of gold” - notice implied solder exemption.
And etc…

Compare to European Hallmarking. In Russia, the final product is
examined. Scrapings are taken from many different parts, including
seams and especially seams. Scrapings are assayed and piece is only
stamped if assay confirms that content of gold is not lower than
established limit.

Leonid Surpin

48

Are you saying the USA laws are still allowing for tolerance of 1.5k?
The hallmarking law states up to.5k discrepancy on jewelry, watch
cases and flatware and 1k on “any other such article”. But the gold
law also states that it can’t be considered gold if it is less than
10k. So if you err it would probably be best be to be on the side of
more than 10k.

49 
Are you saying the USA laws are still allowing for tolerance of
1.5k?

Tolerance is not listed in karat value.

From the FTC guides

"Under the National Stamping Act, articles or parts made of gold
or of gold alloy that contain no solder have a permissible
tolerance of three parts per thousand. If the part tested
contains solder, the permissible tolerance is seven parts per
thousand."

James Binnion
James Binnion Metal Arts

50

Stephan, Hallmarking must have a value to you or else you would not
be registered with a UK Assay Office?

Please do not misrepresent the UK Assay system. It only costs a lot
of money to have something hallmarked if you send a single piece,
where if you required their 1 hour service, it would currently cost
you UKP 50, or UKP 20 if you were willing to wait all day (nearby
Hatton Garden, the London jewellery quarter, is an easy place to
spend a day while you wait). Most people send a parcel of goods in
which case you would currently pay between 37-98 pence per piece for
marking depending on the type and weight of each item. Yes, these
costs have risen considerably since I first registered ten years ago
when the price of silver was considerably less, but including
postage (I don’t live close enough to easily drop a parcel in by
hand) this represents a tiny proportion of sale price (and even the
melt price). Conversely, if I did not have my work hallmarked, I
could only sell my work as white metal and would get only a fraction
of the value. My clients expect hallmarks and if they can’t wait a
week (often less), they pay the extra for Early Hall (overnight)
which is an additional 50% of the hallmarking cost. But you know all
of this if you are registered with the Assay Office.

In terms of cheating the system, I believe the main problem is with
goods entering the UK (which also require assay before they can be
sold) and not our own makers. It would be interesting to question to
the Assay office as to how many imported goods get rejected, though I
suspect that most of the substandard stuff comes in illegally.

The Assay office has been in place since 1327 and like so many
British traditions that make this such a desirable place to visit
(how many of you will be getting up at stupid o’clock in the morning
to watch the Royal Wedding on TV?), why mess with 684+ years of
tradition that has worked to the benefit of the consumer and
goldsmith alike? British hallmarks add value, in any country, and I
am happy to see it continue.

I was once told that the reason the USA does not accept a 9ct mark
is that the alloy is less than 50% gold, and that anything less than
50% is not considered to be gold. Not sure how your 10ct mark works
in that instance.

Kind regards,
Linda

51 
Are you saying the USA laws are still allowing for tolerance of
1.5k? The hallmarking law states up to.5k discrepancy on jewelry,
watch cases and flatware and 1k on "any other such article". But
the gold law also states that it can't be considered gold if it is
less than 10k. So if you err it would probably be best be to be on
the side of more than 10k.

What I am saying is the the law is what law says, and what law says,
nobody knows.

Jokes aside, yes, tolerances have been tightened, but that does not
mean much. Why there should be tolerances at all? That is the better
question. Besides, let’s say you go slightly lower. What is the
punishment?

Leonid Surpin

52

Stephen, I think that the reason many manufacturers in the UK like
the hallmarking system is that it protects the honest jewellers, and
punishes the dishonest. The majority of jewellers obviously wouldn’t
cheat, but those that did would get an advantage over the rest of
us. I know that many of you come from countries without this kind of
system, and that most of the time the customer is not ripped off,
but I’ve also seen jewellery from Europe, the Middle East, Asia and
the Americas that has been very dodgy. One particular “limited
edition” handmade ring marked 925 but actually a mass produced cast
and plated lead alloy comes to mind.

Of course, the hallmarking system can be scammed by anyone who
really puts their mind to it (I can think of half a dozen ways, but
I’m not interested in discussing fraudulent practice when we could
be talking about nice things like manufacturing techniques). But
when they get caught, they are in real trouble. Serious, serious
trouble.

I heard on the radio yesterday that Germany has no hallmarking
system, but that jewellers need a licence. Of all the possible
alternatives, I rather like the UK hallmarking system. If it hadn’t
been for the Birmingham Assay Office, the Birmingham Jewellery
Quarter would not exist, and I probably wouldn’t be in this trade
now.

The other thing of course, is that we’re a traditional bunch over
here - I may not give a damn about a certain wedding, but I do love
the twisted little island that I live on, clambering around on layer
upon layer of historical baggage while the rain pours down. I’ve met
people with furniture older than the countries that some of you live
in :wink:

For the record, the silver exemption weight is 7.78g (approx. 1/4 of
a troyounce), and I agree that hallmarking can be a bit annoying
when you make aring in an hour, and then have to send it away for a
week. But as a rule, it’s a great system, creating a level playing
field. Leonid is right, though - it doesn’t do anything to protect
the purchaser from bad gemstones and poor craftsmanship, but what
system could?

Even my Dad likes the hallmarking system, and he loves money and
hates beaurocracy, so it must be a good thing. I’m hoping to apply
for a sponsors mark later this year, and I will be proud to have a
legally protected mark to put on my work. Another thing to bear in
mind is that hallmarking is self-funding - the government doesn’t
pay for it, the manufacturers do. It ain’t broke, ergo, don’t fix
it.

Jamie Hall
http://primitive.ganoksin.com

53

Situation is actually very simple. In the USA, follow the FTC
regulations. If you don’t then we know what your ethical principles
are.

John

54

Can telling the truth be deceptive? The hallmarking laws in the US
appear to answer ‘yes’.

If an alloy contains 9/24th’s or 8/24th’s gold then it’s in the
consumer’s interest to know exactly what he/she is getting.

The deception occurs with the abuse of a familiar stylistic symbol.
This has been done successfully on silver plated wares using a row
of meaningless symbols that resemble hallmarks.

The law has not solved the problem very well if it states that all
alloys under 10K are brass.

Alastair

55

I have had one run in with the metal police (in Canada) The piece in
question was solely my bosses work. Re-stamp or they would destroy it
on the spot. Those guys smiled less than my cats, and cats never
smile. Make it out of 10K and explain to the client the laws. Make
and stamp as 10K, maybe an extra 9K stamp as part of the design. No
fooling round with the FTC.

jeffD
Demand Designs
Analog/Digital Modelling & Goldsmithing
http://www.gmavt.net/~jdemand

56

It says “such product may also…” so you can use K, Karat, or Kt
instead of spelling out gold which is what that sentence further
stated. The definition of “industry product” is GOLD. It said
"composed throughout of an alloy of gold of not less than 10 karat
fineness". PRODUCT means it can be anything in the US that is made of
GOLD. It can be jewelry, a statue, a toilet, capped teeth, whatever
as long as it is gold.

If you want the entire law, go to the law in the internet. The first
section of the laws usually spell out any pertinent definitions. And
as to gold/silver/and marking there is more than one law we are
dealing with. There is 15 USC 291 through 300, the Patriot Act-AML
Program, FTC laws 16 CFR 23.0 through 23.26, your local laws in your
state, county and city (if you live in a city)… In Georgia it is
43-37-1 through 43-37-6.

Anyhow, live in oblivion if you want. You are on a post that others
are reading. You are basically telling them to do as you do, break
the law. You previously posted that it is ok to make gold less than
10k since US has “tolerances”. But the law specifically states that
anything less than 10k is not gold. You implied that the "tolerances"
were in the range of 1.5k. The tolerances are.5k for jewelry, but
again anything under 10k is not gold. You rip me and say leave the
laws to lawyers… But hey what do I know. I’m just a retired cop who
actually reads the laws, not have a friend who is an attorney just
get me a copy of books which you never even claimed to have read (any
btw the law books I see in lawyers and judges offices take up an
entire wall and costs thousands of dollars, did you get them all and
are you getting the yearly updates? OR did you just get a copy of the
textbooks he used in college like I used when I got my Bachelors in
Criminal Justice?). So quoting laws was my job when I locked people
up and took them to court and prosecuted them… In Georgia, unless
it was a larger county, the cops did the prosecution’s role
themselves. So yes, I have had classes in the law, court, etc.,
myself.

Val

57

I really have to congratulate whoever has been doing the public
relations for the UK Assay Office system. The very people, jewelers,
who I would suppose have the best reason to object to the expense and
bother are the most earnest supporters.

Hallmarking must have a value to you or else you would not be
registered with a UK Assay Office?

I had a big order back in the 1990s that was conditional that my
pieces all bore an Edinburgh hallmark. As the original order for a
hundred silver rings tapered off to reorders for 20 to 50 rings at a
time, the logistics, shipping and expense became enough of a barrier
to my trade that eventually we broke off the relationship. I don’t
think I have sent anything across in over 10 years, but I did renew
my registration.

Please do not misrepresent the UK Assay system.

How have I done that? With shipping (both ways) and the Assay office
fees, the smaller the number of pieces you submit at one time, the
greater the cost per piece. It was not that long ago, when silver
was, say $6.00 or GBP 3.50 per ounce, that smaller jewelry pieces
could have a ridiculously high ratio of Assay cost to actual bullion
value. It would be very easy for me to exceed 1 pound per piece in
costs if my order was less than 30 pieces.

In terms of cheating the system, I believe the main problem is
with goods entering the UK (which also require assay before they
can be sold) and not our own makers.

I suppose that you can credit the assay system for discouraging this
foreigner from selling in the UK, even though my work always passed
assay. But I won’t hold it against you. I still import a lot of
jewelry from Scotland and Ireland.

but I do love the twisted little island that I live on, clambering
around on layer upon layer of historical baggage while the rain
pours down. I've met people with furniture older than the countries
that some of you live in ;)

In talking to many, many assay-bound jewelers on your side of the
water I have to say that Jamie’s statement makes more sense than
actual rational arguments do. I think this system continues because
you cannot imagine it any other way. As I said at the beginning of my
comments, I don’t expect to change anybody’s mind about this, but I
still find it fascinating.

I was once told that the reason the USA does not accept a 9ct mark
is that the alloy is less than 50% gold, and that anything less
than 50% is not considered to be gold. Not sure how your 10ct mark
works in that instance.

I think 10K is partly cultural. But whenever government rules are
such that they put a potential trading partner at a disadvantage,
like those nasty foreigners with their 9ct gold, you can expect some
protectionism.

Stephen Walker

Andover, NY

58 
The law has not solved the problem very well if it states that all
alloys under 10K are brass.

It makes no such assertion, that was John being funny. The law simply
puts a lower limit on gold content exactly like the UK does with 9k

James Binnion
James Binnion Metal Arts

59

No need to get up at O’dark thirty to watch a wedding that will be
replayed on a multitude of sources for days afterword.

Joe
Bloomington, IN (where we thankfully, very thankfully, have not had any
tornados but do continue to receive some excellent thunderstorms!)

60

You asked what the punishments are…

In 15 USC 298 the punishment per instance is basically a $500 fine
or imprisonment of not more than three months OR BOTH… and
basically anyone can sue you. You can be sued by the person you sold
the item to, the person they sold it to, if you advertised the
item-then anyone that saw the advertisement, by competitors even.

In 15 USC 45, which penalizes 16 CFR 23, the punishment is $10,000
fine per instance and they’ll issue a cease and desist. If you take
it to court or don’t cease… when you are finally found to be guilty
(if you are), then you can be fined $10,000 PER DAY, PER INSTANCE
from the date of the cease and desist order. The FTC is allowed to
make a settlement on that amount.

The Patriot Act has a law on jewelry as it relates to money
laundering, but I doubt any of us are really concerned about that
one… On top of those laws, you have to look at your state laws. In
Georgia there are laws regulating gold/silver purchasing… “We buy
gold and silver…”

Someone said the laws don’t mention anything about the stones. They
do. Look over 16 CFR 23.11- 23.26.

And another comment was the gold temperance’s were expressed in the
thousands. It was amended to karat, 15 USC 295, Amendments,
1976-Pub. L. 94-450.

I’ve referenced everything so you can look it all up yourself.
Better yet, I’ve found a website

http://www.ganoksin.com/gnkurl/kl

that has most of it right there.

Val