Organized crime groups that are increasingly embedded in the gold supply chain

Criminal networks are increasingly trying to get control of extraction locations, trade routes and the refining infrastructure.

According to a new report by the UN drug and crime (UNODC), these groups are deeply embedded in gold supply chains, which were drawn by the high profitability of the sector and the increasing gold prices.

“Serious global threat”

The organized crime is so involved in the gold supply that it now represents a “serious global threat”, with illegal networks constantly adapting to activate and hide their operations.

Many of these groups have the progress in transport, financial and communication regulations and take into regular companies, so that they can wash both the proceeds and move illegal gold relatively easily.

Apart from increased violence, corruption and environmental deterioration, crime gangs also set population groups in need of protection, the UN highlights, the risk of sexual exploitation, forced labor and shift.

Use regulations

While the legal mining processes are regulated in order to minimize environmental damage, illegal mining completely avoids these protective measures.

By clearing forests for access to mineral deposits, illegal operations contribute directly to the destruction of the environment, degrading fragile ecosystems and accelerated loss of biodiversity – especially if such activities occur in protected areas.

One of the most serious environmental effects of illegal gold mining is the use of dangerous or forbidden chemicals by criminal organizations.

Occasions

Although the majority of the gold mining locations in Africa south of the Sahara, Latin America, the Caribbean and Southeast Asia, are concentrated in Europe, Asia and North America. As a result, the precious metal often crosses several boundaries before it even reaches a refiner center.

This transnational movement creates opportunities for both exploitation and the intervention of law enforcement.

Criminal groups often illegally introduce gold into the supply chain by using weak supervision, inconsistent documentation and regulatory gaps along the trade routes.

However, the geographical concentration of refineries offers a strategic point for disorders, according to the UNODC report.

The report concluded that the focus of the regulatory efforts on these important hubs could significantly reduce the flow of illegal gold into the global market.