The promise of a better life is driving tens of thousands of men and women into the rainforest of French Guiana. The EU overseas territory is a hotspot for illegal gold mining. Along its streams, gold prospectors dig deep pits, drill tunnels, poison rivers with mercury, build huts and brothels in the middle of the rainforest. Almost all of them are Brazilian. Chinese traders on the river supply the Brazilians with engines, hoses, and mercury. And a system of informers sounds the alarm if the French gendarmerie helicopters get too close.
Between 6 and 8 tons a year are mined in the EU’s largest national park, all of it illegal. Who buys this gold? Where is it refined? Where does it end up?
We accompanied the French Foreign Legion, hunting down illegal gold miners in the forest, chasing suppliers down rivers. We followed the gold from French Guiana to the buyers along the border river in Suriname, into the smuggling village Antonio do Brinco, and by plane to the country’s capital, Paramaribo. We spoke to dubious exporters and buyers, who have connections into Surinamese politics—the “gold cartel” as the former justice minister of Suriname told us.
We followed the gold into the assaying house of Suriname, a joint venture of Surinamese businessmen, the state itself, and a Dubai-based gold refiner, and then onto KLM flights to Amsterdam and to Dubai.
The “gold laundromat” is what several interviewees said is Dubai’s role in the world gold market. Gold from dubious origins gets into the emirate’s refineries, much of it mislabeled as “recycling” to bypass strict sourcing rules of the end consumers in Switzerland, Europe, or the U.K. When sold as “recycling” it loses its origin, and begins a new life cycle, as “clean” gold—it was laundered.
The refineries in Switzerland, that pride themselves on their due diligence, get hit by a new sourcing scandal every few years. Ever stricter regulations in the EU, the U.K., and other Western countries are not able to stop the sourcing of gold of illegal origin. Even the LBMA, the world’s most important gold industry standard, admits that “recycled” gold is the most contentious issue in the gold market today. More than half, 53%, of all gold going through LBMA refineries is declared as “recycled”—about double the figure that the World Gold Council estimated is actually recycled every year.
Germany, the country that holds the world’s second-largest gold reserve, sources 70 percent of its gold from Switzerland. The country has a regulating body just for the sourcing of metals as outlined by EU regulation. Its director said, “Nobody can say with certainty where the gold imported into Germany comes from. Neither the importers, not us.”
To listen to the German podcast Die Goldspur (The Gold Trail), click here.
