On December 31st last year, Stabroek News reported that the Guyana Gold Board (GGB) was investigating allegations made to the international Minerals Grievance Platform (MGP) that local large-scale gold trader, El Dorado Trading was connected to illegally sourced Venezuelan gold, a claim the company denied vehemently when contacted by this newspaper.
Following the allegation, the Royal Canadian Mint (RCM) had suspended the intake of El Dorado gold from the GGB until further notice and the situation appears unchanged up to today. Prior to the Stabroek News report there had been no word from the GGB, the Guyana Geology and Mines Commission, the Ministry of Natural Resources, the APNU+AFC government or the current administration on this serious development even though the GGB had been formally written to since August 13, 2020 by the MGP. Silence abounded notwithstanding that the citizens of this country and stakeholders in the mining industry had every right to be aware of a problem that could lead to blacklisting of gold exports from this country and other unsavory developments as a result of the sanctions regime on Venezuela and general concerns about the illegalities associated with mining in that country.
There can be no claim of “sensitivity” as asserted last week by the Governor of the Central Bank and the current Chairman of the GGB, Dr Gobind Ganga when he was asked by this newspaper to comment on a public statement by the former Chairman of the GGB, GHK Lall about a 2019 Central Bank meeting called by Mr Ganga where it was reportedly stated that the Venezuelan gold was a serious problem. The assertion of “sensitivity” is a cop-out – an unwillingness to address frontally the crux of the matter and to take condign action where necessary. Further, no confidentiality clause governing Bank of Guyana meetings – as alluded to by Mr Ganga – should prejudice the right of the public to important information such as the claim of the contamination by Venezuelan gold.
The sum total of the evasiveness and the lack of will to act is that five months after the Stabroek News report there has been no credible information on any action taken by this or the previous administration to establish whether Venezuelan gold had indeed been commingled here and exported. Despite this dearth of action, there was renewed interest in the matter two Fridays ago after Vice President Bharrat Jagdeo declared at a wide-ranging press conference that there was no evidence to substantiate the presence of Venezuelan gold here even though El Dorado’s gold trader Tamesh Jagmohan has been suspended from supplying the Guyana Gold Board since September of 2019.
The basis of Mr Jagdeo’s remarks has not been established though one can surmise that it is easy to say that there is no evidence of a thing if there has been no effort to discern whether it is indeed present and that seems to be the case here. The silence of the GGB suggests that no initiative has been undertaken to test – as difficult as it would be – whether Venezuelan gold had been illicitly exported from this industry. The absence of action is further confirmed by a subsequent statement on Friday from Mr Ganga where he confirmed to Stabroek News that there are currently active discussions between the Guyana Gold Board and Swiss-headquartered company Argor-Heraeus to possibly trace the origin of gold declared by miners.
“They approached the Gold Board,” Ganga told Stabroek News. He however noted that he could not say how long the discussions have been underway or how long until a decision on the way forward is made.
“I don’t have the details for that. I’ve said all I know which is that there are discussions to trace the gold,” he said.
All the more strange. Why hasn’t the GGB been proactive and why has it had to await the approach of this company to begin discussions? Furthermore, the interest by Argor-Heraeus is a non-starter as it had also faced a number of questions and investigations about illicit gold from the Democratic Republic of the Congo and as a company with a vested interest in selling this country’s precious metal it should not be involved.
For the last ten years it has been crystal clear that the gold industry has been a touchstone for smuggling of all types as highlighted by the theft of a mind-boggling 476 pounds of gold from a Guyanese vessel docked in Curacao. There was no doubt that the vessel and gold originated here and as in many cases of this type neither the Guyanese authorities nor those on Curacao evinced any real interest in an investigation. Again, neither the PPP/C government nor the APNU+AFC administration made any concerted effort to establish who smuggled the gold and could afford to sustain a loss of that magnitude.
Perhaps the most damning dereliction in relation to investigating the gold industry was the ignoring of a recommendation from the Finance Intelligence Unit (FIU) which had been established under the Anti Money Laundering and Countering of the Financing of Terrorism Act which both the PPP/C and APNU+AFC had invested much energy and lip service.
As reported by Stabroek News on January 6th this year, amid concerns that Venezuelan gold was filtering into the local market in 2019 and the Guyana dollar was depreciating substantially as a result, the FIU had recommended that a high-level team be established to do a comprehensive review of the trading of the precious metal.
The FIU report in the second half of 2019 posited a number of questions and recommended that “a high-level team be established to complete a more comprehensive review of the gold trading and Foreign Exchange trading markets to better understand its inner workings and implications. Action needs to be taken at addressing the issue of illegal Cambios including `roadside cambios’”.
The FIU also contended that the Central Bank should also review the appropriateness of gold dealers/traders being approved to operate licensed cambios.
The FIU further recommended that the Central Bank and Law Enforcement should become “more proactively involved in addressing the various issues including undertaking of undercover operations to ensure all completed transactions are being declared/ reported by Licensed Cambios”.
These recommendations by the FIU were completely ignored by two administrations raising serious doubts about whether they are interested at all in ensuring compliance with the AML/CFT.
Any smuggling of Venezuelan gold or diamonds from Guyana could do serious damage to this country’s trade and its image and the decision-makers must take decisive action to determine if the problem exists and its extent.
