Market Standards

Incident Review Process (IRP)

Our Physical Committee and Compliance Panel oversees the policy development and implementation of our Responsible Sourcing programme.

What is an IRP and how does it work?

The Incident Review Process (IRP) is an effective tool to address incidents which are bought to LBMA. It also supports the LBMA Rules and Guidance by ensuring that GDL Refiners and Members adhere to our stringent guidelines and requirements.

Escalation to an IRP may come from a variety of sources, such as industry press and civil society, as well as LBMA’s own proactive monitoring achieved through our internal Due Diligence Procedures. LBMA will seek corroboration wherever possible; however, due to the sensitivities involved, LBMA may keep the information received under the process confidential. Overseen by the General Counsel, the process is designed to ensure a thorough and fair review of the Refiner’s and Member’s activities and involves follow-up communications with the ASP, the Refiner or Member and any other stakeholder related to the incident.

Each step within the IRP is a high priority for LBMA. Upon receipt of relevant information, the Responsible Sourcing, or Membership, Compliance Panel reviews whether to instigate the IRP. The Refiner or Member will then be notified of the identified issue before LBMA publicly notifies the market via its website.

LBMA will urge the Refiner or Member to demonstrate transparency on the allegations reported, publicly. LBMA requests the Refiner or Member to disclose the challenges and identified risks, and how those risks have been mitigated, as well as what further action the Refiner or Member is taking. LBMA will also undertake another thorough review of a Refiner’s assurance engagement report, contextualised by the alleged incident. It is an iterative process, particularly in situations where new information is produced, or as the situation escalates or deteriorates.

The outcome of the IRP process will be subject to a quality control check, by the LBMA Sub-Board Group, who will also determine the final decision. The Sub-Board Group comprises the independent Non-Executive Directors, the Chief Executive and the Executive Directors of the LBMA Board. The decision by this group will be final.

Potential Outcomes

The outcome of an IRP can involve a Refiner being removed from the GDL or a Member having its Membership revoked. Other outcomes include an independent Assurance Provider developing a Corrective Action Plan (CAP) for a Refiner’s future activities or a special re-assurance of the Refiner’s activities that were originally reviewed.

The IRP process:

  1. Receipt/logging of complaint/issue.
  2. Review of the allegation(s).
  3. Identification of possible aberration(s).
  4. Using the tools available, as described in this Due Diligence Policy, perform a review of the possible aberration(s)/allegation(s).
  5. Legal review should be performed, if appropriate and required.
  6. The allegation should be referred to the alleged party, if appropriate.
  7. Escalation to the appropriate LBMA Committee, if necessary.
  8. Decision-making will be undertaken by the Executive Committee and/or Board Sub-Group, in accordance with Section 7 of the Due Diligence Policy.
  9. Notification of a decision if one is required, to the party in question.
  10. LBMA public disclosure will be considered, where there is a conclusion of non-compliance with the Rules, and if the stability of the market can be maintained and applicable laws allow.
  11. Evaluate the lessons learnt.