The London Bullion Market Association’s certification program served as a “thick smokescreen” that enabled serious abuses at a Tanzanian gold mine where two men died, lawyers alleged at the start of a London trial that could threaten its existence.
The LBMA is facing trial after it was sued by the families of two men who were allegedly shot dead by police at the North Mara gold mine in 2019. Lawyers for the two families argue that the gold body’s decisions had a direct effect on the use of violence at the mine.
“LBMA devised, trumpeted, and implemented a responsible sourcing and certification programme which served as a thick smokescreen,” Dominic Grieve, a lawyer for the families, said in court filings prepared for Wednesday’s hearing. “The LBMA provided plausible deniability, even gilded respectability, which meant that the abuses could continue unchecked.”
The six-week trial will scrutinize the outsized role that the relatively small LBMA plays in overseeing the $1-trillion-a-week gold market in London. The outcome of the case could have far-reaching implications for how the industry polices its supply chain.
Leigh Day, the law firm running the claim said that 30 more people have joined the lawsuit pending the outcome of this trial.
The LBMA denies all the claims and can’t be held responsible for the deaths caused by the alleged unlawful actions of the police, its lawyers said in court filings. Holding the body accountable for the deaths could pose an existential threat to the association and its Responsible Gold Guidance scheme, which aims to ensure that supply chains are free of human rights abuses and conflict, they added.
If the court rules that the LBMA owed a duty of care to the two men, “the LBMA could not withstand the resulting legal and financial exposures.”
(By Upmanyu Trivedi)