Brazilian authorities are tightening restrictions on illegal gold miners in Indigenous Yanomami territory, but with miners simply migrating elsewhere, the illicit trade looks set to continue until legislation combatting gold “laundering” is fully established.

Brazil’s Federal Police (Polícia Federal do Brasil – PF) announced on March 2 that wildcat miners leaving the Palimiú and Walo Palis regions of the northern state of Roraima by boat would only be permitted to do so between 7 a.m. and 5 p.m. local time. Checkpoints were set up on the Mucajaí and Catrimani rivers and boats passing through would be inspected, said the force.

The move came as part of an anti-gold mining operation that began in early February to drive illegal miners out of land owned by the Yanomami people. Illegal mining has led to widespread environmental damage in the state, and miners have been accused of attacking Yanomami people and burning their homes.

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On February 23, authorities announced that they would increase the presence of security forces in Roraima after a fleet of mining boats had broken through a blockade on the Uraricoera River and opened fire on government officials, Brazil’s UOL reported

Despite the attack, efforts against illegal miners in Roraima have been largely successful: Only 1,000 of the estimated 15,000 illegal miners that were active in the state remained as of February 23, according to Brazil’s Ministry of Justice and Public Security (Ministério da Justiça e Segurança Pública).

However, there are concerns that the miners forced out of Roraima are simply relocating to other nearby areas. One letter published in mid-February by the Federation of Indigenous Organizations of the Rio Negro (Federação das Organizações Indígenas do Rio Negro – FOIRN) stated that miners using heavy machinery had increasingly begun invading Indigenous territories in Pico da Neblina in Amazonas, the state bordering Roraima.

InSight Crime Analysis

Government operations against wildcat traffickers are only a stop-gap measure until the laundering of illegally-sourced gold becomes more difficult. Recently passed legislation aims to do just that.

Lax regulation in Brazil has long offered the chance for criminals to “launder” gold that has been illegally mined into the legal market. In mid-February, police uncovered an alleged illegal gold smuggling operation valued at $800 million. Those involved were accused of using false documentation to hide the origin of gold that had been illegally taken from the northern state of Pará.

But the introduction of Resolution No. 129 by Brazil’s National Mining Agency (Agência Nacional de Mineração – ANM), the agency responsible for inspecting mining sites, has begun the process of tightening Brazil’s gold trade, adding an additional layer of security against the laundering of illegally-sourced precious metals.

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Previously, buyers of gold needed only to rely on the “good faith” of gold sellers — there was no legal obligation to prove that the gold being traded was of legal origin. Paper receipts made fraud easy.

With the passing of Resolution No. 129, gold buyers must now have systems in place to prove that the gold they purchase has not been mined illegally. According to Reuters, the Brazilian government is also considering introducing electronic tax receipts on all gold and precious metal sales to ensure that falsifying receipts is far harder.

The ramifications of this new legislation could be huge. According to Instituto Escolhas, a Brazilian think tank studying sustainable development, 98% of gold mined in Indigenous territories of the Amazon region between 2018 and 2020 showed evidence of illegality, meaning it was taken from outside designated mining areas or falsely registered as coming from nearby areas.

But while the regulation is a move in the right direction, issues with agency funding will have to be addressed if it is to have the desired effect. The ANM has faced trouble in the past due to severe underfunding. In 2021, it employed just 250 inspectors to monitor roughly 35,000 mining sites across the country. Keeping track of these additional measures will only increase its workload.

Despite President Luiz Inácio Lula da Silva’s promise to reverse the explosion of criminal activity in the Amazon that took place under predecessor Jair Bolsonaro, with gold prices approaching record highs, stopping illegal mining may require a drastic increase in resources.