Precious Metals

Senate bill would combat illicit practices in gold mines

The Feb. 24, 2024, collapse at the illegally operated Bulla Loca gold mine in the Venezuelan Amazon claimed the lives of 16 indigenous miners. A Senate bill seeks to regulate import of the product of such operations.

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The Senate is scheduling to move on proposed legislation requiring the Department of State to develop a comprehensive multi-year strategy to combat illicit gold mining in the Western Hemisphere.

S.797, the United States Legal Gold and Mining Partnership Act, was initially introduced March 14, 2023, by Sen. Marco Rubio, R-Florida. The bill was moved out of the Senate Foreign Relations Committee on May 4 for placement on the Senate Legislative Calendar for further action.

Rubio’s legislation explains that much of the illicit mining is in Latin American countries, and much helps finance drug cartels and terrorist enterprises.

“In Latin America, mineral traders and exporters, local processors, and shell companies linked to transnational criminal networks and illegally armed groups all play a key role in the trafficking, laundering, and commercialization of illicit gold from the region,” according to S.797.

A report on illegally mined gold in Latin America by the Global Initiative Against Transnational Organized Crime presents the following statistics:
➤ More than 70% of the gold mined in several Latin American countries, such as Colombia, Ecuador, and Peru, is mined through illicit means.
➤ About 80% of the gold mined in Venezuela is mined through illicit means, and a large percentage of such gold is sold to Mibiturven, a joint venture operated by the Maduro regime composed of Minerven and Marilyns Proje Yatirim S.A., a Turkish company.

Minerven, Venezuela’s state gold mining company, is a gold processor designated by the office of foreign assets control of the Department of the Treasury, pursuant to Executive Order 13850 (relating to blocking property of additional persons contributing to the situation in Venezuela).

The U.S. Treasury on March 19, 2019, imposed sanctions on Minerven, which it says illicitly props up the regime of President Nicolas Maduro.

Nicaragua’s gold exports during 2021 were valued at an estimated $989 million.

Of that, gold valued at an estimated $898 million was shipped to the United States; gold valued at an estimated $48.7 million was shipped to Switzerland; gold valued at an estimated $39 million was shipped to the United Arab Emirates; and gold valued at an estimated $3.62 million was shipped to Austria.

According to the U.S. Customs and Border Patrol, gold is one of the most commonly illicitly mined resources. CBP’s civil authorities are often called upon to lend assistance and provide greater options to other agencies engaged in the fight against illicit gold when criminal prosecutions may not be an option.

Full details on the legislation can be found online at Congress.gov.

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