Goldrausch: Organized crime in transition mineral supply chains | Rusi

The changing technologies drive the global demand for transition minerals – and attract the attention of organized crime. After success with gold, illegal armed groups in Latin America have new minerals, threaten to clean energy supply chains and legitimate investments in the sector.

The energy transfer, the increased defense spending and the expansion of semiconductor production control mineral requirements. The international energy agency Estimates That the market value of transition minerals, including cobalt, copper, graphite, lithium, nickel and rare earth, will reach almost 800 billion US dollars by 2040, almost twice as high as at 2023.

Geopolitical tensions, trade uncertainties and the geographical concentration of the most important mineral supply chains in China create an urgent need for states to establish safe supply chains in transition minerals. named “Oil, steel and electricity of the 21st century”. Great Britain tried to make Supply chains more resistant to market shocks from Strengthen ties With mineral regions such as Latin America and the support of companies to diversify investments in overseas.

However, Price volatilityConcerns regarding the integrity of environmental, social and governance (ESG) of mineral supply chains and the Competitiveness of the Chinese industry represent significant challenges. So far, certain risks have only received limited attention, such as the prevalence of organized crime and corruption in Latin America and the ability of groups for organized crime (OCGS) and other non -state armed groups (NSAGs) to adapt quickly. The expansion of organized crime into illegal gold recruitment offers a warning story for state and industrial actors with a share of transition to clean energy.

Go gold

Gold has become an essential part of OCG and NSAG business models in mineral parts of Latin America. The gold prices have been more than doubledCreation of strong incentives for drug trafficking organizations to diversify in golden reduction in order to expand their profit margins. In some contexts illegal gold exports Accordingly exceeded Cocaine in profitability. The lack of traceability has also proven to be comfortable as money laundering. Various typologies have appeared in which armed actors Laundry revenue By re-investing the money in mining inputs such as fuel and machinery and washing it illegally gold in legitimate supply chains.

The diversification of OCG and NSAG in gold was made easier by the territorial control of the groups over areas, in which craftsmanship and small miners (ASMS) were widespread. Many ASMS work in forbidden areas without legal mining titles and are therefore classified as “Illegal” miners. These miners tend to face barriers for formalization and deficiency Viable alternative livelihood optionsAllow you only a few ways to work illegally. Armed groups Take advantage of governance Vacuum by confirming ASMS – often by coercion – consolidate control over illegal gold production in exchange that offers protection against law enforcement authorities.

Cassiter-Billier, but more extensive than gold, which is used in coatings for solar collectors and lithium-ion batteries and according to reports soldering aids soldering to the financing of inputs for gold production

This model has become common in the Amazon, where OCGS and NSAGs were consolidated in parts of Brazil, Colombia, Peru and Venezuela. In Brazil the OCG Primeeiro Comando da Capital (PCC) has provided Garimpeiros (Wildcat -Bergfätter) illegally in the Yanomami indigenous territory (YIT) with firearms and heavy machines, which leads to clashes with security forces and attacks on indigenous communities. Los Lobos, an Ecuadorian OCG, tried to replicate this model during its territorial expansion, but has met the resistance of local miners. Which leads to fatal clashes and shift.

Criminal infiltration in illegal gold mines -Stokes conflict between ASMS and multinational mining companies. Since 2021, miners have allegedly connected to the Colombian Ocg Ejército Gaitstißenta de Columbia (EGC) Control Of about 70% of the tunnels of Colombia's greatest burial politics – in the possession of a subsidiary of the Chinese Zijin mining group – using firearms and improvised explosive bodies (IEDS), the company led to demand military intervention. By providing weapons and the shabby antagonism, the involvement of OCGs in such disputes escalates the potential for violence. For example on May 2, increasingly organized Goldmine gangs in Perus la Libertad Department attacked Mining installations of the Poderosa Mining Company and kidnapped and killed 13 of their workers.

Apart from the fact that conflicts and the financing of armed groups are increasingly organized, illegal gold yield increasingly causes the environment and public health. The use of Heavy machinery and toxic chemicals Like mercury, rivers dirty, disturbs aquatic ecosystems and contaminating water and food sources used by local communities. In addition, the land conversion drives for the deforestation of the mining, which leads to loss of biodiversity and accelerating climate change by disturbing the Amazon Critical role as carbon sinks.

A smooth transition

While gold for many Latin American OCGs and NSAGs remains the primary mining interest, the evidence indicates that they are increasingly diversifying to other minerals and quickly react to new opportunities.

In April 2025 the Colombian authorities confiscated 49 tons of Coltan and tin illegally extracted from the departments of Guainía and Vichada and allegedly designated for China by Colombia's port of Cartagena. The illegal extraction of Coltan – used in most electronics and cars – has become common Space in the Puinawai National Reserve in Guainía and in advance. NSAGs active in the region – including the Ejército de Liberación Nacional (eln) and Frente Acacio Medina of the dissident Fuerzas -Armadas Revolucionarias de Colombia (FARC) – have diversified and reproduced Modus Operandi Extension of ASMS and laundry of illegal coltan in legitimate global supply chains.

In Brazil's yit, OCGS have minerals like Copper, manganese and cassite (a Zinnerz) in your portfolios since 2021. Cassy-billier, but more rich than gold, in coatings for solar collectors and lithium-ion batteries and soldering agents for electronics-actual actual actual Reports are used to finance inputs for gold production. In 2023 the Brazilian authorities specified This cassite -extracted, illegally extracted from the reserve, was sold to a large tin producer who had not checked the origin of the mineral and exported the processed end product to multinational customers. Cassite and other minerals are Subject to less regulatory controls As gold in Brazil and creates opportunities for fraud and supply chain.

When OCGs extend into transition minerals, the tensions between ASMS and mining companies will probably increase. In Peru, Las Bambas has coppermine-in-in-in Submitted over 100 legal complaints Against ASMS to supposedly calm in his concession and steal copper. Although OCGS do not currently advance this activity, such disputes as their expansion into copper violent conflicts between legitimate investors and ASMS could stimulate the same way as the EGC in Colombia.

Mitigating supply chain risks

The expansion of organized crime to transition mineral recruitment in Latin America shows a growing risk for the mining industry, the integrity of the supply chain and the investment stability. The British government, a Important financial and trade center The intention has expressed for mining Lead efforts When improving the ESG standards for mineral supply chains, but has could not use his position sensibly.

Gold should serve as a precautionary precise for weak ESG standards. The OCG and NSAG expansion in gold has increased the resilience of these groups and drove violent conflicts and environmental deterioration in local communities. Foreign companies that were certified by the London Bullion Market as high -quality dealers were involved In the illegal procurement, which indicates the prevailing challenges and restrictions on the efforts to promote responsible procurement. Transition mineral risk according to the same trajectory, since some minerals – as from Cassiterite – showed face Even fewer Due diligence reviewsAnd experience the same traceability problems.

In order to mitigate this risk, the interest groups of politics and industry must prepare through evaluation which minerals are exposed to the strongest organized crime risks and the associated damage, to implement strictly responsible procurement practices and to anticipate the risk of social conflicts in which concessions with ASM communities and OCG or NSAG presence overlap. Further research and greater interdisciplinary cooperation between political decision -makers, industrial companies and civil society are required to fill them Important knowledge gaps And identify opportunities to protect strategic supply chains.

© Rusi, 2025.

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