GUY$42 billion worth of gold smuggled in four months; several visas revoked – updates added

GUY$42 billion worth of gold smuggled in four months; several visas revoked

Wednesday, 26 August 2015. Demerara Waves

Guyanese and United States (US) authorities have uncovered a money laundering and gold smuggling racket that has so far fleeced the country of more than US$200 million (GUY$42 billion) worth of the precious metal over a four-month period.

Top officials of the Guyana government said a number of Guyanese gold exporters have been smuggling out huge quantities of gold  from Guyana and on arriving in the US have been declaring them as “scrap gold” which do not attract duties in that country.

The failure to declare gold exports at the Cheddi Jagan International Airport also means that the Guyana Revenue Authority (GRA) has not been unable to tax the exports here.

The calculation of US$200 million was made for gold arrivals from Guyana over the period November, 2014 to March, 2015.

The officials have confirmed that the smuggling and sale of “scrap gold” in the US is part of a massive money laundering operation.

The American visas of several gold miners and traders have since been revoked, even as several more are the subject of an intensive investigation.

While some of the gold is being funneled through the Cheddi Jagan International Airport, authorities say other quantities are being placed on Suriname-bound planes at the Ogle International Airport.  Apart from attracting lower taxes in Suriname, the yellow metal is sold to the Middle East.

The sources said security is relaxed to allow the smugglers to pass through both airports without checks and declarations.

Majority of smuggled gold taken to Suriname via planes

AUGUST 28, 2015 | BY | GRA launching probe, vows action

One day after Government confirmed that a major investigation has been launched into a huge gold smuggling racket that has been negatively impacting the economy, there are more details emerging about the secretive trade.
The Guyana Revenue Authority (GRA) has stepped into the matter, too, yesterday saying that the tax collection agency is concerned about the revelations and is launching its own probe, while stating that the possibilities of Customs officers being part of the scheme is unlikely.
Initial indications were that 10,000-15,000 ounces of gold were leaving Guyana weekly – the majority for the US. It appears now that the Suriname route has been the one preferred by both illegal and licenced traders.
Illegal traders, according to Government officials and investigators, used planes at the Ogle Airport to take the gold to Suriname, without even declaring what was on board.
Other traders, some of them licenced, also preferred to fly direct to Suriname with their precious cargo, under-declaring the amounts or sometimes not declaring it at all.
Sometimes the flights were officially filed to fly to Berbice but instead, the planes ended up in Suriname.
Quite a significant amount of gold, not declared to the Guyana Gold Board and other authorities, was also being flown to neighbouring Brazil.

A significant amount of gold is being smuggled to Suriname, Government officials say.

A significant amount of gold is being smuggled to Suriname, Government officials say.

Officials knowledgeable about the rackets said that investigators should examine paperwork relating to the gold being declared in Guyana by the traders as against what is declared in countries like the US, Suriname and Brazil. It would most likely also reveal a significant number of under-declarations on official documents in Guyana.
LOOPHOLES
“The problem is occurring right at the airports in Guyana. You would not dare take a chance outside of Guyana; thinking of fudging the records or lying to authorities. All the loopholes are happening right here at the Ogle Airport and at CJIA. What we are hearing about is only a tip of the iceberg!” one official emphasised.
The official disclosed that Guyana is losing big time in another way. Licenced traders and others returning with large amounts of cash have found ways not to declare the monies when they return from the US and other countries.
On Wednesday, Government officials confirmed that a major investigation is underway into the smuggling of gold from Guyana.
The new administration was reportedly alerted to the organised scheme by the US Government who became alarmed after noticing a surge of gold being taken to that country.
While it is not a new thing to Guyana, gold smuggling has seen a sharp spike over the last two years, as world market prices fell.  Already for this year, the industry has recorded a 30 percent drop in declarations.
Last year, declarations fell to 387,508 ounces from a high of 481,000 ounces in 2013. Foreign currency earnings from the gold trade also saw a sharp reduction from US$716M in 2013 to US$470M last year, a big dent for the country’s revenues.
The Guyana Gold Board has been reporting falling declarations which was blamed on miners leaving the industry because of poor world prices. The extent of smuggling has not been known until now, with Government being told that the industry was in deep trouble and needed help.
The US Government has reportedly yanked the visas for a number of licenced traders and other businessmen involved in the trade.
It is believed that at least US$500M in gold is being smuggled annually.
The smuggling involved independent traders who have been taking smaller amounts of up to 200 ounces out on direct flights to the US.
Government has called in the Special Organized Crime Unit (SOCU) to investigate the racket.
On Wednesday, Minister Raphael Trotman, who has responsibilities for Natural Resources, disclosed the reduction of gold smuggling is a major priority for the administration.
PERTURBED GRA
Yesterday, GRA in response to news of the smuggling racket said it is most perturbed by recent revelations in the press about an organised gold smuggling racket, and the implication of Customs officials in the malpractice.
GRA said it has been battling in the past to weed out officers who were involved in wrongdoings.
The entity said that, based on the roles and responsibilities of Customs officers, particularly at CJIA and other ports of entry, it is quite baffling to the authority that officers would be embroiled in the illegal gold smuggling ring.
“Nevertheless it is GRA’s view that every person or agency in question should cooperate with the authorities and avoid speculation.”
The agency explained that passengers are allowed with gold jewellery without declarations once it does not exceed a certain value.
“On the other hand those in possession of raw and scrap gold and those with gold in commercial quantities, must make the required declarations. In such instances, the declaration must be accompanied by an approved import licence and permission from the Guyana Gold Board with an attachment stating the price, weight and other particulars of the shipper and consignee.”
GRA admitted that there is a likelihood of persons taking advantage of this allowance to elude Customs officials.
“As such, the support from other enforcement agencies such as the Customs Anti Narcotics Unit (CANU) would be integral given the pervasive nature of smuggling. Customs Officers at the CJIA do not monitor outgoing passengers’ baggage. This activity is monitored solely by CANU, the Criminal Investigation Department and Special Branch of the Guyana Police Force and airport security personnel.”
GRA stressed that in the event of any discovery, Customs is notified by the relevant agency.
GRA said it will be seeking to ascertain the perpetrators in question to determine what enforcement action will be taken in accordance with the country’s border, trade laws and regulations.
“It is however worth noting that part of the responsibilities of Customs officers at the CJIA include the monitoring of the duty free shop, the incoming and outgoing desk, and the movement and trans-shipment of cargo.”

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Comments

  • de castro  On 08/27/2015 at 3:41 am

    Question
    If gold is possible….what else…..people/children ?

    A land surrounded by “thick jungle”borders is a “smugglers” paradise.

    If border controls cannot be “policed” “control” why have borders ?

    Latin america is ripe for “SHENGEN” agreement…..?countries without borders.
    Join undercover “policing” prior during and after signatories.
    International prosecutions made public as a deterrent.

    Well done US law enforcers.

    In 4 months Wow WOW 😬😬

  • guyaneseonline  On 08/27/2015 at 6:26 pm

    GRA perturbed by revelations of gold smuggling

    The Guyana Revenue Authority (GRA) today said it is disturbed by reports in the media about an organised gold smuggling racket.
    A release from the GRA follows:

    The Guyana Revenue Authority (GRA) is most perturbed by recent revelations in the press about an organised gold smuggling racket and the implication of customs officials in this malpractice.
    Based on its previous experiences in the past where the integrity of the GRA was compromised by officers within the Authority who have been in collusion with unscrupulous characters, fervent efforts have been made to hold officers accountable to standard operational procedures.
    Moreover, based on the roles and responsibilities of customs officers, particularly at the Cheddi Jagan International Airport (CJIA) and other ports of entry, it is quite baffling to the Authority that officers would be embroiled in the illegal gold smuggling ring. Nevertheless it is GRA’s view that every person or agency in question should cooperate with the authorities and avoid speculation.

    In accordance with the law, passengers with gold worn jewellery are not required to make a declaration providing that it does not exceed a certain value. On the other hand those in possession of raw and scrap gold and those with gold in commercial quantities, must make the required declarations. In such instances, the declaration must be accompanied by an approved import licence and permission from the Guyana Gold Board with an attachment stating the price, weight and other particulars of the shipper and consignee.

    There is therefore a likelihood that because of the foregoing provisions, there would be an enticement to smuggle items as worn jewellery in an attempt to elude Customs officials. As such, the support from other enforcement agencies such as the Customs Anti-Narcotics Unit (CANU) would be integral given the pervasive nature of smuggling.

    Customs Officers at the CJIA do not monitor outgoing passengers’ baggage. This activity is monitored solely by CANU, the Criminal Investigation Department and Special Branch of the Guyana Police Force and airport security personnel. In the event of any discovery, Customs is notified by the relevant agency.

    Additionally, with pressure from the international community for countries to strengthen its legislation to guard against money laundering and the financing of terrorism, there is likely to be greater scrutiny for persons from Guyana to disclose the source of their valuable assets to US authorities.

    From a Customs perspective, the GRA will be seeking to ascertain the perpetrators in question to determine what enforcement action will be taken in accordance with the country’s border, trade laws and regulations.
    It is however worth noting, that part of the responsibilities of Customs officers at the CJIA include the monitoring of the duty free shop, the incoming and outgoing desk, and the movement and transshipment of cargo.

  • De castro  On 08/27/2015 at 9:02 pm

    There seems to be”buck passing” in the above statement.

    With the CANU as prime suspect.😈

    Every item of luggage and passengers should be “scanned” “scrutinised”
    on exit as per international standards/regulation.
    In this instance it is “gold” which raises the question….what else ?
    Any frequent traveller should be very concerned when leaving CJIA.
    Avoiding if necessary…..until the authorities concerned are investigated
    and the necessary action taken to guarantee the safety of passengers.

    Until these assurances/practices are implemented most frequent travellers
    will avoid CJIA. SORRY the above statement is not convincing.

  • guyaneseonline  On 08/28/2015 at 1:52 am

    Multi-billion$$$ gold smuggling racket blown wide open
    AUGUST 27, 2015 | BY KNEWS | FILED UNDER NEWS
    – collusion at Airports, Customs being investigated – Govt. official
    – smugglers’ US visas revoked

    In recent years, Guyana has been cashing in on high gold prices, with miners and investors taking the risks and plunging headlong into the industry. They borrowed heavily from the banks, used their life’s savings and even took heavy machinery on credit.
    Things were looking good, with declarations reaching an all-time high in 2013 – over 481,000 ounces, and with gold earnings reaching an unprecedented US$716M that year.
    However, as world prices plunged last year, gold exports contracted 20 percent, with only 387,508 ounces declared to the Guyana Gold Board by licensed traders. Export earnings fell to US$470M.
    It was widely believed that scores of miners, disheartened by the price drop on the world market, pulled out, causing production to fall. However, there is emerging evidence that the huge drop is a direct result of a well organized smuggling racket that involved not only ordinary business persons but also licensed gold exporters. The racket also involves senior officials and key personnel at the country’s airports.
    For this year alone, gold declarations have fallen behind 30 percent, when compared to the same period of 2014.
    It was one of the major contributory factors that caused the economy to reflect a lower growth rate last year as gold was the biggest foreign currency earner, ahead of rice and sugar. It has fallen behind now.
    According to a senior Government official involved in the investigation, the coalition administration was alerted to the situation by the US authorities, since the issue goes way beyond mere smuggling. It also involves money laundering.
    This newspaper has since learnt that the US Embassy here in Georgetown has revoked the visas of a number of persons, including businessmen, licensed gold exporters, their workers and even members of their families.
    As a matter of fact, the prevalence of gold smuggling has been likened to that of the lucrative drug trade in Guyana, the Government official said yesterday.
    Both licensed and illegal gold traders are battling each other to take control of the trade.
    The situation has gotten quite worse over the last two years. It is estimated that between 10,000-15,000 ounces of gold per week is being smuggled out via the Ogle and Cheddi Jagan International Airports. Some more is being taken overland to the border at Corentyne to Suriname and via Lethem to Brazil.
    At the very least, it means that Guyana is losing out from revenues that can be earned from at least US$500M in gold sales.
    It also means that the amount being smuggled annually is more than what is declared to official buyers like the Guyana Gold Board and the licensed traders.
    With Guyana charging up to 7 percent of the value in royalties and taxes, places like Suriname and Brazil have become attractive markets because of the lucrative profits due to the lower taxes in those countries.
    The gold racket has spread its tentacles as far as Belgium in Europe and the Middle East.
    According to the official, Government and the Guyana Gold Board have called in the Special Organized Crime Unit (SOCU) to lead the investigations. And it is no wonder – the smuggling racket is highly organized. Small unlicensed traders have worked out a system using direct flights to JFK International Airport, New York. They would buy up to 100 or 200 ounces. With gold at a four-year low of just over US$1,100 per ounce, the money involved is not chicken feed.
    Kaieteur News was told that Customs officers and other security personnel at the airports are tipped off when the traders are flying out, and would turn a blind eye to what is being taken out.
    “The situation has become a wild west one. It is hurting the country. We are talking about saving here and saving there. The gold smuggling, simply put, is creating a big hole at the bottom of the pot. It is big money…millions of US dollars monthly. We are losing big time. And everybody is getting a cut of it,” the government source said.
    Investigators have found that quite a number of the illegal gold traders are holders of US passports or “green cards” who would have seized the opportunity to make a quick buck. It is a fact that most of these traders know each other. They would line up at JFK to declare the gold after disembarking their flights.
    With regards to the larger licensed traders, the smuggling is even more sophisticated, this newspaper was told.
    Official Customs documents are reportedly recycled, with persons being paid off at the airports.
    Yesterday, Minister with responsibilities for Natural Resources, Raphael Trotman, admitted that a probe involving a number of agencies like the Guyana Gold Board and SOCU is underway.
    “The smuggling of gold has been given priority because every ounce of gold smuggled, we are not getting royalties…we are being robbed.”
    He said that the gold is being smuggled across the border at Brazil…it goes up to Europe, and of course gold is being smuggled to the US.
    He declined to give details, but insisted that the gold smuggling issue is a priority for the administration.
    Yesterday, General Manager of the Guyana Gold Board, Lisaveta Ramotar, also confirmed that an investigation is ongoing, but she declined to go into details. She made it clear that any gold leaving the country through CJIA has to be approved by the Guyana Gold Board. If there is no permission, she stressed, then it is leaving illegally.
    “Every ounce of gold that leaves this country undeclared is of concern to us. It is revenues for the country. We feel strongly about this, but it is under investigation by SOCU.”

  • de castro  On 08/28/2015 at 2:54 am

    Question
    7% on gold exported.

    % on rice exported ?
    % on sugar exported ?
    % on other commodities (weed) exported ?

    Not to mention % on “imports”

    Black holes in the economy if not “addressed” will bankrupt the state.

    What is being done/spent to plug the gap (gaping hole) ?

    More questions than answers…leaves a bitter/sweet taste.!

    Corruption at every level in society distroys integrity of that society.
    Guyana no exception….all societies have corruption some legal
    some illegal…the legal can be monitored/controlled/regulated.
    It is the illegal/unknown that is difficult/impossible to police.

    Make laws that are enforceable/enforced…zero tolerance laws.
    Yesterday not tomorrow.

    Its not rocket science…..commonsense laws by act of parliament.
    The struggle is uphill..the rewards worth the struggle.

  • de castro  On 08/31/2015 at 4:33 pm

    Tip of the “iceburg”….much more to follow…not just gold…other items even people/children. Hope my suggestion is only “speculation” !

    Find them charge them prosecute them convict and jail them.
    Name and shame them…..it will send the right signal/message.
    No one even the president is above the law.

    Way forward.

  • albert  On 08/31/2015 at 6:59 pm

    A very wealthy Guyanese group of a large company, who we l know, smuggled millions in gold since the 80’s to th US. When ‘caught ” they paid a fine, and I suspect a good piece to some politicians, then allowed to operate freely in Guyana. Whats new.

  • de castro  On 09/01/2015 at 1:34 am

    Point my finger at the”local rabble” for not naming and shaming.
    Libel my guess.
    Unfortunately not many Guyanese have internet access in their homes
    for its “international” source of information.
    Guyanese online is certainly a step in right direction but because
    of lack of internet access it has limited readership.
    Why not start another daily “local rabble” and build up a readership base.

    All you need is a tablet and a decent laser printer.

    Would certainly write “left wing” columns for you.
    As annex trade unionist Corbyn and Sanders are my candidates
    for USA/uk politrickesters.
    But check out the libel laws first…..don’t wish to visit my editor in chief
    in mazurini goal.😂

    Kamtan

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