Producers rip off non-SJC gold bullion holders

With SJC gold bullion chosen as the national brand, the State Bank of Vietnam has allowed Saigon Jewelry Co, its producer, to convert the gold bars of other brand names such as Rong Thang Long, SBJ, and PNJ, into SJC products.

Customers, however, are not allowed to bring their gold bullion directly to SJC for the conversion, but have to sell them to banks, gold shops or the brand owners, where they are ripped off with buying prices much lower than those of the SJC bars, although the conversion fee is only VND50,000 a tael.

Thanh, a Rong Thang Long gold bullion holder in Hanoi, said she has recently had to sell her two gold bars after failing to withstand the constantly falling price, although it used to be equally traded as SJC gold.

Thanh brought the precious metal to the Bao Tin Minh Chau Company, where the board quoted the buying price for Rong Thang Long as only VND42.7 million a tael.

The rate was VND3.43 million a tael lower than the buying price of SJC gold bullion at that time, and Rong Thang Long bore the lowest buying price, she said.

“I asked them how the price gap could be so huge while the difference used to be modest, and was told that every other brand name shares the same price gap after SJC was chosen as the national brand,” she told Tuoi Tre.

Van, a resident of Ho Chi Minh City’s Phu Nhuan District, said she was also informed of a lower buying price when she attempted to sell her one-tael SBJ gold bullion to its producer, Sacombank.

The banker told her that the buying price was VND45.23 million, some VND1 million a tael lower than the rate quoted for SJC, she said.

“It’s 20 times higher than the VND50,000 fee to have the bullion converted,” she said.

“Although I know it’s unreasonable, I have no choice as gold shops now do not buy any brand of gold bullion but SJC,” she shared.

Make up for losses

The non-SJC gold bullion producers have bought back the gold bars they produced from customers at cheap prices in order to make up for the losses they incurred when storing the gold to wait for permission to convert them to SJC bars, a general director of a gold company in District 1 explained.

Nguyen Thanh Long, chairman of the Vietnam Gold Business Association, said it is unacceptable for the producers to rip off customers, as the profits they gain after their gold bullion have been converted are much greater than the losses.

“It’s a moral issue. Businesses cannot just focus on benefitting themselves without caring about the customers’ right and interest,” he said.

Four times the central bank has granted quota for Saigon Jewelry Co to convert the non-SJC gold bullion over the last two months, but it didn’t specify the exact amount each producer was allowed to have converted.