There is no provenance
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How a collection loses it
Cards fall out of jars, specimens are regrouped for display, a spreadsheet is lost, or a collection changes hands without its paper. None of those is dramatic and all of them are permanent.
What it costs
The ability to sell, the ability to lend to a museum, and most of the scientific value. Locality and formation are what make a fossil evidence rather than a decoration.
And it cannot be reconstructed
A plausible locality inferred from the species is a guess, and writing a guess on a label is exactly the false record the statute names. The honest record is "locality unknown".
Which is still a usable record
Locality unknown, acquired from X on date Y, is informative. It tells a buyer what the specimen is and is not, and it lets them make their own decision rather than relying on a precision nobody has.
Buying without it carries the same risk
Acquiring, receiving and purchasing are all named in the prohibition, so a buyer is exposed too. A dealer who cannot say where a specimen came from has told you something.
Record it at the moment of acquisition
Every time, in the jar, on the card, before the specimen joins the collection. It takes a minute then and it is impossible later, which is the whole of the practice.
And keep the acquisition documents
Invoices, permissions from landowners, correspondence. Those are what turn a label into evidence, and they are what a serious buyer or a museum will ask to see.
The record is most of the value
Two identical trilobites, one with a locality and a date and one without, are not worth the same and should not be. The paper is not administrative overhead on top of the specimen, it is a large part of what a buyer is buying.