Case Studies

An investigation by Insight Crime in 2024 discovered that prospectors are damaging Bolivia’s Tuichi River and Madidi National Park in their search for gold. As miners increasingly breach the reserve, park rangers have reduced their patrols and inspections. The mining is carried out by small-scale cooperatives, known locally as cooperativas, which sometimes act like mafias. These cooperatives control 94% of Bolivia’s national gold production. They often operate in a state of near-impunity, thanks to grey areas in Bolivian law and little oversight by the government’s mining agency, AJAM. The cooperatives have political power and have been known to hold the government hostage, bribe and coerce mining agency officials, and have dealings with Colombian and Chinese mining outfits. Bolivia is currently experiencing a gold boom, with production increasing from 6.3 tons in 2010 to 42 tons in 2019, fuelled by a distinct lack of controls on the mining, sale, or export of the precious metal. 

Keywords: Latin America, Bolivia, minerals, primary production, gold, corruption and bribery, illegal gold mining

Source: https://insightcrime.org/investigations/gold-mining-state-sanctioned-scourge-bolivia/ 

A powerful Fujian/Putian criminal network based in Bolivia, has established a far-reaching collaboration network that extends to China. This network includes customs officials and Chinese-based traders.  In addition to illegal logging and illegal wildlife trafficking, the group is heavily involved in illegal gold mining in the Amazonian regions of Bolivia, in an area very close to one branch of the amazon river. Informants shared that the unauthorised mining is conducted with Chinese associates, and the gold is often sold in a small town nearby. During their investigation, Earth League International (ELI) uncovered patterns of corruption involving government officials. The criminal network has been facilitating the acquisition of large procurement contracts for managing sites and roads on behalf of Chinese state-owned companies.  ELI informants had also revealed that the group bribed a local politician and the indigenous village chief to gain permission to illegally dig gold mines in the smaller river areas around Rio Suapi and Rio Alto Beni.  

 
Keywords: Latin America, Bolivia, minerals, gold, primary production, procurement of permits, illegal gold mining, corruption and bribery, serious organised crime

Source: https://earthleagueinternational.org/wp-content/uploads/2023/06/ELI-Environmental-Crime-Convergence-Report-June-2023.pdf

An investigatory report by Greenpeace led to allegations that South Korean machinery manufacturer HD Hyundai Construction Equipment (HD HCE) contributed to deforestation in the Amazon by providing excavators to illegal gold miners operating within Indigenous territories, in areas of Brazil which were degraded 202% more between 2019 and 2021 compared to the preceding decade. 
In the Indigenous lands of Yanomami, Munduruku, and Kayapó, 75 Hyundai excavators were identified during aerial surveys conducted between 2021 and 2023. Illicit mining activities have led to a humanitarian crisis in these areas; for example, contaminated rivers have posed health risks to Yanomami adults and children. 

Keywords: Latin America, Brazil, minerals, mining, supply of machinery/equipment, Indigenous rights

Source: https://www.theguardian.com/environment/2023/apr/12/hyundai-urged-to-stop-miners-using-its-machines-in-amazon , https://www.theguardian.com/world/2023/jan/22/lula-accuses-jair-bolsonaro-genocide-yanomami-indigenous-amazon  

Belo Sun Mining Ltd, a Canadian company based in Toronto, has been developing the Volta Grande gold project in Pará State, Brazil since 2012. The project, including a planned open-pit gold mine, is the ancestral home of several Indigenous Peoples and riverine (Ribeirinho) communities. The project has faced numerous legal challenges and complaints. The main issues include inadequate impact studies on the impact to Indigenous Peoples, questionable licensing processes, insufficient consultation with Ribeirinho communities, and potential violations of land rights. Despite these challenges, the project was designated a priority under Brazil's 2021 Pro-Strategic Minerals Policy. Human rights defenders, including Indigenous Peoples, have faced ongoing threats and intimidation related to their opposition to the project. Belo Sun's security firm, Invictus, reportedly intimidated local communities with armed patrols and surveillance. For instance, in October 2023, Belo Sun filed a criminal complaint against 40 individuals accusing them of criminal activities related to land protests. 

Keywords: Latin America, Brazil, minerals, gold, primary production, Indigenous rights, human rights violations, land grabbing

Sources:  https://srdefenders.org/brazil-threats-intimidation-and-harassment-of-human-rights-defenders-in-the-context-of-the-volta-grande-gold-mining-project-joint-communication/ 

Brazilian federal authorities launched an investigation into a money laundering network suspected of moving millions of dollars’ worth of illicit gold in 2023. Through a network of shell companies, individuals are alleged to have moved money linked to gold illegally sourced from Brazil’s northern neighbor Guyana. In one instance, a shell company purportedly to be trading hospital supplies was alleged to have laundered over $12.3 million in gold. Shell companies play an important role in Brazil’s illicit gold industry, with these companies providing a way for criminals to issue invoices without a physical address to hide the illegal origin of exported gold. Authorities have estimated that over 30 tonnes of gold is illegally extracted each year from the Brazilian Amazon, with this illicit practice exploiting low-earning miners in areas of poor human and economic development, causing considerable deforestation and socio-economic harm. 

Keywords: Latin America, Brazil, minerals, gold, primary production, deforestation, illegal mining

Source: https://www.occrp.org/en/daily/17831-brazil-launches-investigation-into-r-80-million-in-illegal-gold  

According to a press release issued by the Brazilian government, an operation led by its Federal Police dismantled an international criminal organisation involved in the illegal extraction, trade, and export of precious stones, particularly rough diamonds and gold. On April 26, 2023, Brazil's Federal Police launched Operation Itamarã, which encompassed a total of 42 search and seizure warrants and eight preventive arrest warrants across several Brazilian states and involved international cooperation with the United States, Belgium, England, and the United Arab Emirates. Investigations began in 2020, as the organisation’s activities were first revealed through the arrest of a suspect at Guarulhos International Airport. The suspect was found carrying rough diamonds without proper documentation. Subsequent seizures included gold bars at Confins/MG Airport and rough diamonds intercepted with the help of U.S. Homeland Security Investigations. The operation eventually uncovered that the criminal organisation had extensive operations in over a dozen countries, involving complex financial schemes and the use of shell companies to issue false invoices. They also co-opted legitimate companies to facilitate the illegal export of precious stones. 

 
Keywords: Latin America, Brazil, mining, diamonds, gold, illegal mining, serious organised crime, fraudulent documentation

Sources:  https://www.gov.br/pf/pt-br/assuntos/noticias/2023/04/pf-deflagra-operacao-contra-organizacao-criminosa-de-extracao-e-comercio-ilegal-de-diamantes 

A report by the United Nations Office on Drugs and Crime details how the illicit gold trade in Burkina Faso has played a critical role in financing conflicts. Artisanal and small-scale gold mining (ASGM), a focal point for the country’s economy, provides resources to non-state armed groups, and contributing to instability in the region. In Burkina Faso, ASGM produced approximately 49.5 tons of gold in 2018, valued at around $2.7 billion in 2022. The artisanal gold mining market is a significant source of income for many communities, but a big portion of this gold is smuggled out of the country, avoiding formal channels and taxation. The revenue derived from this illicit trade is often reinvested in weapons and vehicles, providing increased economic prosperity for armed groups, such as those affiliated with Jama'a Nusrat ul-Islam wa al-Muslimin (JNIM), during conflicts. The influx of weapons into the region, especially after the 2011 Libyan revolution, has made arms readily available to different groups, contributing to the weaponisation of existing trafficking routes. In addition, the smuggling networks also play a role in supplying armed groups with recruits. Migrant smugglers, for instance, liaise with armed groups and pay taxes for safe passage through territories controlled by these groups.  

Keywords: Sub-Saharan Africa, Burkina Faso, minerals, gold, primary production, illegal mining, terrorist and conflict financing, tax evasion 

Sources:  https://www.unodc.org/documents/data-and-analysis/tocta_sahel/TOCTA_Sahel_Transversal_2024.pdf 

A report commissioned by the government of Burkina Faso revealed that extremist political groups frequently attacked gold mines in order to access gold as a source of funding. Since 2016, armed extremist groups have accumulated 70 billion CFA francs ($126 million) following attacks on mining sites. These extremists, often linked to Islamic State and al-Qaeda, target gold mines in order to seize control and extort taxes. The central governments' limited control over mining regions leaves communities vulnerable, and struggling to defend themselves from these well-armed groups. Extremist groups not only target gold mines in the aims of conflict financing, but also to supply explosives for terrorist activities. Terrorist groups view the control of gold mines and transport routes as crucial for legitimacy and power over local populations. This control leads to violence as groups compete for profits and dominance. Lastly, the loss of governmental tax revenue from gold smuggling undermines funding for social programs and counter-terrorism efforts.  

Keywords: Sub-Saharan Africa, Burkina Faso, minerals, gold, primary production, illegal mining, terrorist and conflict financing, tax evasion

Sources:  https://www.state.gov/wp-content/uploads/2021/10/BURKINA-FASO-2020-HUMAN-RIGHTS-REPORT.pdf 

https://adf-magazine.com/2023/10/terrorists-target-the-sahels-gold-mines-as-a-source-of-financing/ 

Cameroon faces significant challenges in relation to children's rights, particularly in artisanal mining areas. These areas employ many children, who are left exposed to several forms of exploitation, one of the most severe issues being sexual exploitation. According to a 2023 UNICEF report, around 20,000 children in these areas are survivors of sexual exploitation, with half of them being girls. These children are often exploited by mineral buyers, police officers, and other adults, forced into prostitution, sexual services, or marriages with adult men. This exploitation is primarily due to poverty, as well as a lack of education, and a weak state presence in these areas. The consequences for children who are sexually exploited are severe, including mental health issues, physical violence, school dropouts, and increased involvement in crime and prostitution. Despite efforts by the Cameroonian government and civil society organisations to combat this issue, measures employed are not sufficient. Organisations like the Réseau des Femmes Leaders pour le Développement (RFLD) play a crucial role in combating child sexual exploitation by organising awareness sessions and providing support to child survivors, including legal, medical, and psychological assistance.  

Keywords: Sub-Saharan, Cameroon, minerals, mining, primary production, child labour, labour rights violations, human trafficking

Source:  https://rflgd.org/2024/01/21/cameroon-the-sad-reality-of-child-sexual-exploitation-in-artisanal-mining-areas/#:~:text=Sexual%20exploitation%20of%20children%20is,police%20officers%20and%20other%20adults 

In Chile, trade misinvoicing, which occurs when export or import invoices are falsified in the final goal of tax evasion or money laundering, remains prevalent. This practice is particularly significant in the copper industry, which accounted for 48.2% of the nation’s total exports in 2018. By underreporting the value of copper exports, companies have minimised their taxable revenue. Conversely, overreporting import values has allowed companies to reduce their tax burdens by inflating deductible costs. For instance, this practice was employed by Chile’s state-owned copper corporation, CODELCO, in its agreement with China Minmetals Corporation to supply copper at below-market rates. This has raised concerns about potential tax evasion and undervaluation. Trade misinvoicing also allows for money laundering, as falsely reported trade transactions are used to conceal illicit proceeds. Money can notably be moved across borders, as has been found to be the case for Caso Yaupel, a fruit importer and distributor that laundered money digitally across Colombia, Germany, Ecuador, and Chile. Trade misinvoicing is not just an economic problem but also affects public welfare and security. The practice is often linked with other criminal activities like drug trafficking and human trafficking.  

Keywords: Latin America, Chile, minerals, copper, trade and transport, tax evasion, money laundering, trade misinvoicing

Sources:  https://gfintegrity.org/trade-misinvoicing-in-chile/