HomeNewsBriefAirport Controls Unlikely to Stem Flow of Illegal Gold From Peru
BRIEF

Airport Controls Unlikely to Stem Flow of Illegal Gold From Peru

GOLD / 11 FEB 2014 BY MIRIAM WELLS EN

Special security teams tasked with catching contraband gold smuggling will be placed in five airports in Peru, though the efficiency of gold laundering inside the country means the initiative will likely have limited impact on the billion dollar trade.

From February 21, teams formed of police and officials from Peru's Public Ministry will start operations in Lima, Arequipa, Cusco, Juliaca and Madre de Dios airports, reported El Comercio. The teams' mission will be detecting the transport of illegally sourced gold and other minerals out of the country.

Senior mining official Daniel Urresti said the teams would "hit the illegal mining trade hard because they will make the transport chain more complicated. The objective is to raise the transport costs so that mining ceases to be a profitable business."

The government also plans to create a register of buyers of cyanide and mercury, two chemicals used in the gold mining process.

InSight Crime Analysis

Peru's illegal gold mining industry is huge, generating as much as $3 billion a year -- constituting about a fifth of all Peruvian gold exports. Urresti estimates that 80 percent of illegally mined gold leaves via the country's airports. This estimate is probably about right, making these teams a step in the right direction, according to Quinn Kepes, a US researcher who last year completed extensive fieldwork (pdf) investigating Peru's illegal gold trade.

However a large proportion of that gold is laundered -- given fake receipts guaranteeing it was sourced from legal mining concessions -- before it reaches the airport, meaning formal companies export large quantities of illegally sourced gold through official channels. For instance, Universal Metal Trading, known to be one of Peru's major exporters of illegal gold, transported more than 19 tons of gold to Switzerland in 2011 via the airline KLM, according to government figures.

"In many cases, by the time the gold is making its way out of the country, it is already being passed off as 'legal,'" said Kepes.

SEE ALSO: Peru News and Profiles

Inspections by the teams will only catch gold that has not been provided with fake receipts, and will certainly not be able to affect the profitability of the illegal supply chain as hoped by Urresti. To do that would require catching the "acopiadores" (gold brokers who make the fake receipts), and to do so would require cracking down on corruption among regional officials and security forces, which is an immense task.

In any case, as pointed out by Kepes, "Just like drugs, the smugglers will adapt, so what's really needed is to get to the source -- where the [illegal gold] is produced and extracted."

share icon icon icon

Was this content helpful?

We want to sustain Latin America’s largest organized crime database, but in order to do so, we need resources.

DONATE

What are your thoughts? Click here to send InSight Crime your comments.

We encourage readers to copy and distribute our work for non-commercial purposes, with attribution to InSight Crime in the byline and links to the original at both the top and bottom of the article. Check the Creative Commons website for more details of how to share our work, and please send us an email if you use an article.

Was this content helpful?

We want to sustain Latin America’s largest organized crime database, but in order to do so, we need resources.

DONATE

Related Content

EXTORTION / 19 NOV 2013

Criminal groups operating in the city of Trujillo, in northwestern Peru, make over $4 million a year extorting public transport…

PERU / 8 AUG 2012

IDL-Reporteros details the changing landscape of the drug trade in Peru’s VRAE region, whose trafficking clans are increasingly basing their…

MONEY LAUNDERING / 31 AUG 2012

U.S. and Peruvian authorities say Peru is now a major producer of counterfeit bills, and may be attracting foreign money…

About InSight Crime

THE ORGANIZATION

Combating Environmental Crime in Colombia

15 JUN 2021

InSight Crime presented findings from an investigation into the main criminal activities fueling environmental destruction in Colombia.

THE ORGANIZATION

Collaborating on Citizen Security Initiatives

8 JUN 2021

Co-director Steven Dudley worked with Chemonics, a DC-based development firm, to analyze the organization’s citizen security programs in Mexico.

THE ORGANIZATION

InSight Crime Deepens Its Connections with Universities

31 MAY 2021

A partnership with the University for Peace will complement InSight Crime’s research methodology and expertise on Costa Rica.

THE ORGANIZATION

With Support from USAID, InSight Crime Will Investigate Organized Crime in Haiti

31 MAY 2021

The project will seek to map out Haiti's principal criminal economies, profile the specific groups and actors, and detail their links to elements of the state.

THE ORGANIZATION

We Have Updated Our Website

4 FEB 2021

Welcome to our new home page. We have revamped the site to create a better display and reader experience.