Ojo Público traced illegal gold mining to international companies (June 18, 2015)

An investigation by Ojo Público sheds light on illegal gold exports from South America -- and the international companies that finance the illicit extraction. According to Ojo Público, many tons of gold that leave the region illegally can be traced to a group of companies linked to the London Bullion Market Association, the organization which sets the international price for the metal and concentrates its major traders.

The corporations in question allegedly include Swiss Metalor Technologies and MKS Finance; U.S. Northern Texas Refinery and Republic Metals Corporation; Italian Italpreziosi and the Dubai Kaloti group, according to Ojo Público.

Fabiola Torres, one of the report's authors, explained to TeleSur that the results were obtained by comparing documents showing how much gold leaves the country legally and how much enters Miami, Zurich or Rome as imports.
"When you investigate the exports, there are tons that are sent away every year," Torres told TeleSur, "that means that there is a great deal of gold that is out of the system, does not pay taxes, and it is making a few people rich but the wealth is not staying in the country of origin, it's going abroad." 

Judicial documents reviewed by Ojo Público show how the heads of international businesses negotiated million dollar sales with illegal mining chiefs, organized crime groups and phantom exporters and sham companies. All of them centered their operations in Lima in recent years, though they have also invested in "suspect" exporters in La Paz, Medellín, and the Ecuador-Peru border.

The case of Peru is emphasized in the report. The country officially ranks as the world's fifth largest gold producer, but including the 150 tons of contraband exports bumps it up to number two. The numbers are big. While in 2010 Peru officially produced 180 tons of gold, in reality it exported 330 tons.

That translates to a value of over $5 billion dollars a year, according to TeleSur.

Peruvian authorities have been investigating the case since 2012, and captured over a ton of contraband gold destined to NTR Metals, Kaloti, Republic Metals Corporation, Italpreziosi and Metalor Technologies, according to the report.

The report also goes into the case of Bolivia, where gold exports grew exponentially and dubiously, and Colombia, where illicit gold mining has displaced cocaine production in certain FARC held areas. About half of Colombian illegal mining is run by organized crime groups, according to one of their sources. 

In Ecuador, where gold exports tripled between 2012 and 2014, authorities estimate that only 30 percent of the production is legal.

News Briefs

• Thousands of Haitians and Dominicans of Haitian descent endured endless lines yesterday, in an attempt to file residency paperwork before the deadline imposed by Dominican authorities. As of today unregistered Haitian workers -- and potentially thousands of Dominican-born Haitian descendants -- could be deported to Haiti. (See yesterday's post.) Dominican authorities have sent mixed messages as to when the deportations might start: On the one hand, Dominican Foreign Minister Andres Navarro said there will be no mass deportations, but on the other Army Gen. Rubén Darío Paulino announced that the immigration department and military would launch neighborhood patrols Thursday in search of those without documents, reports the Miami Herald. Haitian authorities are preparing for an influx of repatriated nationals. The Dominican government's actions are electorally motivated, according to the Wall Street Journal. President Danilo Medina ran on a tough anti-immigration platform when he was elected in 2012, during a campaign when officials had threatened deportation. Last week Dominican lawmakers approved a constitutional amendment permitting a president to seek consecutive reelection. The DR will hold elections of August of next year. Though formally deportations have not started, in fact they have been ongoing on a small scale, reports the New York Times (also mentioned in yesterday's post). Operation Shield in the DR has been rounding up and deporting Haitians who migrated after 2011, though others have been caught in the web, including people who have been attempting to complete the residency registration process, which supposedly protects them from deportation. Many Dominicans feel their country is under siege from migrants, according to the piece, while authorities point out that they are hardly the only country trying to control flows of undocumented migrants.

• Haitian-American novelist Edwidge Danticat has a piece in the New Yorker on the Catch-22 situation faced by many descendants of Haitian migrants: while the Dominican Republic is trying to deport them, they have no legal status in Haiti either. While large-scale deportations in the 1990s simply dumped Haitians across the border, this time there is some coordination between Haitian and Dominican authorities she writes. She writes that many Haitians are also angry with their leadership, which they accuse of colluding with Dominican elites. "Both sides have used the Haitian and Dominican poor as pawns in trade disagreements and other bilateral disputes."

• Despite the graft scandal rocking his administration, and torch-lit protests demanding his resignation, Honduran President Juan Orlando Hernández believes that the U.S. Congress might pass a massive Central American aide package anyway. The Alliance for Prosperity is designed to try to curb poverty and violence that send tens of thousands of Central Americans fleeing north each year through Mexico in search of work and a better life in the United States, reports AFP.

• Honduran soldiers are taking over public hospitals and medicine storage warehouses to guarantee the supply of drugs to patients after a recent graft scandal involving the country's social security institute. Hernández says they will perform inventory tasks and identify shortages that must be addressed, reports the AP.

• The head of a congressional probe charged with investigating President Otto Perez Molina in relation to graft schemes involving government officials is himself being accused of corruption by Guatemalan prosecutors, according to the AP. The country's top prosecutor and the head of a U.N. commission investigating criminal networks in Guatemala said that Congressman Baudilio Hichos is suspected of an inappropriate real estate rental contract involving the social security agency and a building he controls.

• Colombian FARC rebel group blew up an oil pipeline in Catatumbo, contaminating a local river and leaving at least 16,000 people without water. In an unrelated incident, four military personnel were killed and four more were injured when they stepped on landmines in the southern region of Caqueta, reports the BBC.

• FARC leaders yesterday lambasted President Juan Manuel Santos for his incoherent account of the country and the ongoing Havana peace talks with the guerrilla group, reports EFE. Responding to a speech Santos gave earlier this week in Norway, they said "Colombia is not the country of marvels sketched in Oslo, but rather the third-most-unequal (country) in the world." (See Tuesday's briefs.)

• Mexico's auto industry is booming -- 3.2 million cars were produced here last year in 18 factories -- but a protests at a Mazda plant in Salamanca shows how workers have little recourse in conflicts with management, reports the Washington Post.

• The Cuban government is halving the cost of internet access and adding wifi capacity to dozens of state run internet centers. is the first significant expansion of the Internet in Cuba since the announcement of diplomatic thaw with the U.S. six months ago, reports the AP.

• Tens of thousands of Chilean teachers marched in Santiago to protest an educational reform that includes a requirement for teacher testing. Teachers have been striking for two weeks, and ongoing negotiations have produced little progress, reports the Latin American Herald Tribune.