HomeNewsColombia Drug Trafficking Money Laundered Through Modified Gold
NEWS

Colombia Drug Trafficking Money Laundered Through Modified Gold

COLOMBIA / 17 JUN 2021 BY JAVIER VILLALBA EN

A criminal group in Colombia is turning dirty money into adulterated gold, in the latest addition to a long list of laundering schemes using the precious metal.

The Gaitanist Self-Defense Forces of Colombia (Autodefensas Gaitanistas de Colombia – AGC), also known as the Urabeños, have been linked to front companies that buy gold from Europe, El Heraldo reports. The gold is then adulterated with other metals to the point where it yields double the weight, according to an unnamed judicial source who spoke about the scheme.

SEE ALSO: Profile of the Urabeños

The adulterated gold is sold under the guise that it was extracted in Colombia, or is fashioned into jewelry locally, with would-be buyers unaware that it is not pure.

Though the gold sales primarily serve to launder drug trafficking money, the adulterated gold has proven to be profitable on its own. By creating the alloys, the crime group earns "twice the price," the source said.

InSight Crime Analysis

While dirty gold has become a common method to launder drug money in recent years, Colombian traffickers from the days of Pablo Escobar have paved their way in gold.

In the 1980s, gold bars were bought with drug money, smelted, and then passed off as local production.

The Cali Cartel laundered hundreds of millions of dollars through a gold-buying scheme. Drug money deposited in Italian banks was used to buy gold bullion. The gold was then sent to Panama, where it was sold off for cash.

SEE ALSO: Massacres Spike in Antioquia as Colombia's Urabeños Expand

So much gold was being bought in Italy with drug money that it threatened to destabilize prices there, an Italian police official said in 1994.

In the 2000s, Salvatore Mancuso, a commander of the paramilitary federation United Self-Defense Forces of Colombia (Autodefensas Unidas de Colombia – AUC), laundered cocaine profits through gold bought in Panama. The gold was then smuggled into Colombia, smelted, and passed off to town mayors who sold it to the State as though it were extracted locally.

As a result, several security measures were put in place in Colombia to track sales of gold and to verify that it is the product of Colombian mines. One such safeguard is the Single Registry for Minerals Commercialization (Registro Único de Comercializadores de Minerales - RUCOM), which includes a list of the people authorized to buy and sell gold in Colombia.

Nevertheless, gold purchased abroad is still used as a money laundering vehicle in the country. According to reports compiled by the
Organization for Economic Cooperation and Development (La Organización para la Cooperación y el Desarrollo Económicos - OCDE) in 2017, gold is smuggled to border departments like Chocó, where it is passed off as regional production, using fake miners or falsifying documents for RUCOM.

The business is so lucrative that the drug traffickers incentivize the extraction of illegal gold in Colombia, buying machinery and creating new mines. They also purchase large quantities of illegal gold, and then launder it through formal mining permits so that it can be sold on the legal market.

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

AUC / 19 APR 2012

"Emerald Czar" Victor Carranza is Colombia's Teflon man, having survived various attempts to assassinate and prosecute him over a 30-year…

COLOMBIA / 19 FEB 2018

The governments of Colombia and Ecuador have agreed to ramp up security cooperation along their shared border as criminal violence…

COLOMBIA / 14 SEP 2016

Colombia's ELN rebel group is reportedly moving in on territory abandoned by the FARC guerrillas as part of their peace…

About InSight Crime

THE ORGANIZATION

InSight Crime Tackles Illegal Fishing

15 OCT 2021

In October, InSight Crime and American University’s Center for Latin American and Latino Studies (CLALS) began a year-long project on illegal, unreported, unregulated (IUU) fishing in…

THE ORGANIZATION

InSight Crime Featured in Handbook for Reporting on Organized Crime

8 OCT 2021

In late September, the Global Investigative Journalism Network (GIJN) published an excerpt of its forthcoming guide on reporting organized crime in Indonesia.

THE ORGANIZATION

Probing Organized Crime in Haiti

1 OCT 2021

InSight Crime has made it a priority to investigate organized crime in Haiti, where an impotent state is reeling after the July assassination of President Jovenel Moïse, coupled with an…

THE ORGANIZATION

Emergency First Aid in Hostile Environments

24 SEP 2021

At InSight Crime's annual treat, we ramped up hostile environment and emergency first aid training for our 40-member staff, many of whom conduct on-the-ground investigations in dangerous corners of the region.

THE ORGANIZATION

Series on Environmental Crime in the Amazon Generates Headlines

17 SEP 2021

InSight Crime and the Igarapé Institute have been delighted at the response to our joint investigation into environmental crimes in the Colombian Amazon. Coverage of our chapters dedicated to illegal mining…