The Pallion Group is the largest precious metals services group in Australia. It consists of six entities: ABC Bullion, ABC Refinery, Palloys, Goldenage International, Custodian Vaults, and WJ Sanders.
The ABC Refinery website states that the company is a member of the Responsible Jewellery Council (RJC); however, the RJC website has no record of any such membership.
A website page dedicated to international accreditations reads: “ABC Refinery is also a member of the Responsible Jewellery Council.”
It continues: “RJC Members commit to and are independently audited against the RJC Code of Practices – an international standard on responsible business practices for diamonds, gold and platinum group metals.”
These claims are potentially misleading and deceptive; however, these issues are not restricted to the company’s website.
Similar seemingly incorrect claims are made on the personal website of Pallion Group chief operating officer Phillip Cochineas.
“ABC Refinery remains an industry leader in acidless separation. These initiatives have been recognised by a number of organisations, including the Responsible Jewellery Council (RJC),” his website states.
“Pallion’s subsidiaries ABC Refinery and Palloys became accredited with the RJC in 2019.”
A search of the ‘Find a Member’ function on the RJC website displays records for Palloys and Goldenage International; however, there are “0 results found” for ABC Refinery.
Background reading: Pallion: Timeline of missing detail, controversy, and legal dispute
Jeweller contacted Pallion Group chief executive officer Andrew Cochineas to confirm which of his companies are RJC members.
A response was issued by Geoff Fowlstone, a crisis communications and reputation management consultant who acts for Pallion Group. He confirmed that Palloys and Goldenage International are RJC members. Goldenage International joined the RJC in June.
However, when it came to ABC Refinery, Fowlstone offered a convoluted response referencing the London Bullion Market Association (LBMA).
“ABC Refinery is accredited as a good delivery refiner for both gold and silver by the LBMA,” he said.
“According to the RJC rules, this meets the relevant due diligence requirements of the RJC’s 2019 CoP standard”.
Fowlstone’s explanation seems to suggest that ABC Refinery has an RJC membership courtesy of merely meeting the requirements of the organisation’s Code of Practices.
As mentioned, the RJC website does not list the company as a member or detail any company certification.
It should be noted that the Palloys website displays an RJC certification number alongside the organisation’s logo.
Despite claiming to be a member of the RJC, the ABC Refinery website does not display the RJC logo or any certification number, casting further doubts over these claims.
This would be an apparent contradiction of how the ABC Refinery promotes its business to the broader Australian jewellery industry. These claims may breach Australian Consumer Law as regulated by the Australian Competition and Consumer Commission (ACCC).
Section 18 states: “A person must not, in trade or commerce, engage in conduct that is misleading or deceptive or likely to mislead or deceive. The conduct must be misleading or deceptive or likely to mislead or deceive”.
While these misleading claims should raise alarm bells for the RJC, other issues relating to its member may also be of interest.
Palloys joined the RJC in 2016, and its certification was extended by three years for the first time in May 2019 and for a further three years in May 2022.
A website page listing Palloys ‘accreditations’ makes a number of false claims.
Alongside the RJC logo and certification number, the website states: “Palloys is Australia's only jewellery manufacturer and wholesaler accredited by the Responsible Jewellery Council (RJC)”.
It further states: “Palloys is the first and only Australian jewellery manufacturer and wholesaler to be certified by the Responsible Jewellery Council.”
A review of the RJC website reveals that the claim that Palloys is the only Australian jewellery manufacturer and wholesaler certified with the RJC is false.
There are eight other Australian members of the RJC, some of which are accredited.
Red flags & the RJC
This confusion aside, what is clear is that of the six companies under the Pallion Group's umbrella, only two are members of the RJC. While Palloys makes false claims about the nature of its membership, a third Pallion company — ABC Refinery — falsely claims to be a member.
While these issues should concern the RJC's board and management, they pale in comparison to other matters that the standards-setting organisation has seemingly ignored or overlooked.
In a well-documented case, Pallion Group companies and their directors are under fire from government regulators. The Australian Taxation Office (ATO) is chasing more than $200 million in GST payments from a Pallion Group company, which the directors liquidated.
The 10-year legal battle is complex, and the effects on the Australian jewellery industry have been comprehensively reported in Jeweller.
In summary, Federal Court of Australia documents outlined how a GST fraud scheme benefited EBS & Associates - the Pallion Group company liquidated by its directors - and suggested that the directors were "willing and informed beneficiaries of the scheme".
The court documents reveal an astonishing increase in the company’s revenue.
Before it was liquidated, EBS & Associates had increased its revenue by more than $600 million in just two years - from $130 million in the 2012 financial year to $764 million by 2014.
Following the start of an audit into EBS & Associates’ taxation affairs in July 2014, a new company - ABC Refinery (Australia) Pty Ltd - was incorporated in August 2015. The directors of this new company were the same people who were directors of EBS & Associates, along with Paul Cochineas.
One month later, on 1 September 2015, when the company was under audit, the business and assets of EBS & Associates were transferred to ABC Refinery.
Federal Court documents described the action as a ‘phoenix operation’, usually designed to avoid tax liabilities.
This is the Pallion Group company that is claiming membership to the RJC.
It should be noted that on 31 July last year, Judge Goodman of the Federal Court of Australia ordered the appointment of Special Purpose Liquidators to EBS & Associates (ACN 607 537 548) along with investigations into ABC Refinery and the sale of EBS & Associates' assets and the business to ABC Refinery.
The court orders also include investigations into any "breaches of duty owed by directors or officers and/or de facto or shadow directors of EBS & Associates".
Justice Goodman added, "And part of the investigation will be into the conduct of Mr Andrew Cochineas and interests associated with him."
Screaming into the void
As detailed to the court, significant criticism was levied against two Pallion Group directors, Andrew Cochineas and Jane (Janie) Simpson. Both were described as having "had actual knowledge of the fraudulent activities”.
Given the ongoing litigation between the ATO and Pallion Group, Palloys' certification as a member of the RJC raises serious questions about the organisation’s governance and management on many levels.
Since the initial investigation into the $200 million legal case, Jeweller has become aware of several potentially severe RJC board and management failings.
These issues have been raised with the RJC’s executive director, Melanie Grant, and they include potential breaches of the Codes of Practice, as well as further governance, management, transparency, and accountability concerns.
At the time of publication, Grant has refused to acknowledge the information, let alone provide any transparency on the matter.
» Editor's Note: Readers with information about alleged wrongdoing and/or financial crimes in the jewellery industry can either, formally or anonymously, contact Jeweller via the Contact Us form or write directly to our Tips email address.
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