The government and local regulatory agencies remained tightlipped yesterday on claims by the United States that some 10,000 kilogrammes of gold was smuggled out of this country between 2019-2023.
Washington on Tuesday imposed sanctions on businessmen Nazar Mohamed, his son Azruddin Mohamed, and Permanent Secretary in the Ministry of Labour, Mae Toussaint Jr Thomas.
The Mohameds and Toussaint Jr Thomas have remained silent on the matter.
The Ministry of Natural Resources yesterday said that while it is responsible for mining activities, it will not address the issue of how gold worth over US$50 million in royalties was smuggled out of Guyana while the Guyana Revenue Authority (GRA) said it was awaiting information on the collusion aspect of the case.
There has been no word from the Financial Intelligence Unit, the Guyana Police Force, the Guyana Gold Board, the Guyana Geology and Mines Commission, the Bank of Guyana, or the Special Organised Crime Unit.
A source told this newspaper that the Gold Board could only be held accountable if there are records indicating that it falsified documents for gold sold or exported and “this does not seem to be the case because the (US) Treasury was very specific.”
“This is not gold that never made it to the Gold Board. This is a case where the gold was sold by the small or medium scale miners to a dealer and that dealer smuggled that gold out… we don’t have a regulatory unit at Gold Board,” the source said.
The fact that there is no enforcement arm at the Gold Board was echoed by another source.
“By law, all gold exported has to be sold to the Gold Board within a 30-day period. The Gold Board is also the official entity to approve gold for export. Anything else is a violation and anyone exporting without that approval is in violation [of the law]. You are engaging in an illegal act,” the source said.
“In terms of enforcement, indeed the Gold Board doesn’t have an enforcement arm nor does any investigation itself and is dependent on the police, SOCU, the GRA, and so on. They don’t investigate even if someone failed to declare within that 30-day window. And if you falsify documents; have a false declaration, they still can’t do anything but call in the police or relevant authority,” the source added.
In Guyana, the Bank of Guyana is the regulatory entity over the Gold Board because when gold is sold to the board and then aggregated and in turn sold overseas, that money goes into the Government of Guyana’s United States Federal Reserve account which the BoG manages.
The US Treasury allegations against the Mohameds include defrauding the government here of some US$50 million in royalties and other benefits from smuggled gold, as well as bribing public officials. Concerning Toussaint Jr Thomas, it said that she used her office while serving at the Ministry of Home Affairs, to offer benefits to the Mohameds that included contracts, licences for weapons, and passports.
Share all the information
On the corruption front, President Irfaan Ali was on Tuesday asked about the matter and said that he had spoken to United States Ambassador Nicole Theriot and asked her to share all the information the US has with Guyana’s local agencies.
“I saw the press release. I have engaged the United States Ambassador and of course you know that we take these issues very seriously. I have asked the Ambassador to share all the information with us so that our local agency can have that information and she has endeavoured to make the request; to have all the information that they are in possession [of] shared with us. So that we can have the local agencies look at that information,” Ali said.
And when it comes to the allegations against Toussaint Jr.Thomas, he said that he had not at the time spoken to her but the decision was taken to send her on leave.
“In relation to Permanent Secretary, I have not had the opportunity to engage her as yet. But while we await information and whatever documents the Treasury Department will send to us, that we have requested, the PS will be on leave.”
The Office of Foreign Assets Control (OFAC) – a financial intelligence and enforcement agency of the US Treasury Department – designated Azruddin Mohamed and Mohamed’s Enterprise “for being persons who have materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of, corruption, including the misappropriation of state assets, the expropriation of private assets for personal gain, corruption related to government contracts or the extraction of natural resources, or bribery, that is conducted by a foreign person.”
OFAC also designated Nazar Mohamed as being “a foreign person who is or has been a leader or official of Mohamed’s Enterprise, an entity whose property and interests in property are blocked pursuant to E.O. 13818, as a result of activities related to Nazar’s tenure.”
As for Toussaint Jr Thomas, OFAC designated her as being “a foreign person who is a current or former government official, or a person acting for or on behalf of such an official, who is responsible for or complicit in, or has directly or indirectly engaged in, corruption, including the misappropriation of state assets, the expropriation of private assets for personal gain, corruption related to government contracts or the extraction of natural resources, or bribery.”
The Mohameds on Tuesday declined Stabroek News’ request for a response.
The Guyana Government on Tuesday issued a statement informing that Toussaint Jr Thomas had been sent on leave with immediate effect while it gathers more information.
“Based on the information referenced in the press release, the Ministry of Finance and relevant statutory agencies including the Guyana Revenue Authority, will be requesting additional information on the matters highlighted, with a view to aiding local law enforcement agencies. The Government of Guyana takes very seriously the claims contained in the press release and will continue to engage relevant United States entities on these matters. In the meantime, the Permanent Secretary of the Ministry of Labour, Ms. Mae Thomas has been sent on leave with immediate effect,” the statement from Government said.
“The Government of Guyana will continue to work with the United States government on all matters of mutual interest, including the respect for the rule of law and order,” it added.
Now that the trio are under sanctions, all property and interests in property belonging to them that are in the United States or in the possession or control of US persons are blocked and must be reported to the Treasury Department.
And if they have more than 50 per cent interest in any other company, then those entities fall under the same sanctioning regime.
United States citizens and companies are now also prohibited from doing any transactions with the trio along with financial institutions globally, as they too expose themselves for similar sanctions.
It is unclear if the senior Mohamed will step down as PPP/C Neighbourhood Democratic Council representative and Chairman for the Eccles/Ramsburg district. He had won his seat overwhelmingly at last June’s Local Government Elections.
Mae Toussaint Jr. Thomas had been elected as one of the PPP/C Central Executive Committee’s five non-voting members and it is also unclear what her fate in the party is.
For years, PPP/C governments and the APNU+AFC government of 2015 to 2020 have been criticized for not doing enough to counter what is believed to be rampant gold smuggling.
Warned
Over the last two decades, governments here have been warned about the large-scale gold smuggling out of the country but there have only been a few successes.
Just last week, officers of the GRA seized a large quantity of gold jewellery from three passengers, two of whom are US citizens, who were attempting to leave on an outbound American Airlines flight bound for New York, USA.
The operation, which was fully supported by officers of the Ministry of Natural Resources (MNR), and the Customs Anti-Narcotic Unit (CANU), led to the discovery of approximately 240 ounces of virtually pure gold disguised as silver-plated jewellery, intended to be shipped out of the country without the necessary permits and declaration to Customs officials, with a value of over US$560,000.
There have been overt displays of the illicit hoarding of gold by dealers and in a notorious occurrence, the theft of a huge shipment of gold in Curacao which was believed to be en route to the US after being loaded in Guyana.
There have also been questions about Venezuelan gold being commingled with Guyana’s gold.
In January this year, Attorney General Anil Nandlall SC noted that gold smuggling was one of the highest money laundering threats in Guyana, which was flagged by the second Money Laundering and Terrorist Financing National Risk Assessment in 2022.
The National Risk Assessment (NRA) noted that in 2016 it was reported that 15,000 ounces of gold was smuggled out of Guyana weekly, while in 2017, a major gold smuggling racket was unearthed through the US Federal Bureau of Investigation (FBI) which provided Guyana’s authorities with a list of persons who had taken gold to the JFK Airport, New York, and declaring it there.
“The smuggling was made possible because Customs and other Gold Board documents were recycled along with seals. Hundreds of millions of dollars of profits were being made but little for Guyana. Considering these factors, smuggling including gold smuggling represents a High Threat of money laundering in Guyana,” the report said.
The NRA report emphasized that the findings are based on statistical evidence of investigated and prosecuted cases, and on the value of proceeds confiscated, as well as estimated to have been generated from the crimes, while estimates are based mainly on media reports, and suspicious transaction reports filed with the Financial Intelligence Unit (FIU).
In July last year, Brazil said it was conducting an investigation involving a Guyanese businessman, who was said to be part of a smuggling ring where some R$80 million (US$16.4 million) of illegally mined gold was laundered through shell companies in the food and medical supply industries.
In 2012, the 476 pounds of gold, believed to have originated from Guyana, was stolen from the Guyanese fishing boat Summer Bliss, which was docked in the Dutch Caribbean island of Curacao.
Based on the information this newspaper received then, the vessel was on its way to Miami but made a stop in Curaçao. The gold was valued at approximately US$11.5 million.
In September of 2022, several men were charged jointly with stealing 1,000 ounces of raw gold from Bibi Acklema Goberdhan.
According to the police, Satrohan Seegobin and his father, contractor Bhaloonauth Seegobin found the gold while conducting repairs on the home of Goberdhan, who they only identified as a businesswoman who had been a gold dealer for a number of years. No charge was brought against her for hoarding gold even though she was in clear contravention of the law.
The Gold Board Act makes it illegal for persons who are not producers to have raw gold in their possession and stipulates that it must be sold to the Board or to any agent authorized in writing by the Board.
