Jagdeo: Govt. investigating gold smuggling

Jul 22, 2023 News

Kaieteur News – An investigation into the steep decline in gold declarations made to the Guyana Gold Board (GGB) over the past six years is underway, as authorities here believe the resources are being smuggled into neighbouring Brazil.

Vice President Bharrat Jagdeo during a press conference on Thursday told reporters at Freedom House that the noticeable decline in gold declarations, as first reported by Kaieteur News, could be as a result of the country’s resources being smuggled into Brazil.

Vice President, Bharrat Jagdeo

He explained, “I see a big thing about gold smuggling now too and its absolutely right…Kaieteur News has (reported) a drop in declarations of gold from 2017…it’s absolutely true that we have noticed, especially the last couple of years a significant deviation and the story coming out from Brazil now we realize it may be diverting (there).”

The former Head of State noted that the government was formerly of the view that gold from Venezuela was coming into Guyana to bypass the sanctions, then head North through a legal route. However, it has now realized that it is Guyana’s gold that is being smuggled into Brazil.

“When we saw an article recently in Brazil, we had not been officially notified before that all of this gold was going into Brazil. In fact, we found it strange that our gold would go there; we were thinking that Venezuelan gold was coming in but it doesn’t seem so,” Jagdeo noted.

It was reported that the Brazilian Federal Police in Boa Vista, Roraima are investigating a Guyanese businessman, for allegedly laundering some US$16.5M in smuggled gold, through shell companies in Brazil.

According to the Brazilian Federal Police (Policia Federal), the investigation was launched on July 7, 2023.

“On the morning of this Friday (7/7), the Federal Police launched Operation Vanglória, with the aim of investigating suspects using shell companies to move more than R$80 million (US$16.5M) that would originate from the purchase and sale of illegal gold,” the Federal Police announced on its official website.

“The investigations began after receiving information linking a Guyanese businessman, who would work in the mining industry in his home country (Guyana), to suspicious activities in Brazil,” the Brazilian authorities said.

Jagdeo said he believes that miners are engaged in this activity to avoid paying the five percent royalty owed to the State, along with the two percent final tax attached to the mining activities.

According to him, “That might be one of the reasons, so we, there is an ongoing investigation into that and we are gonna take tough measures against people because we are gonna track also those who are benefitting from concessions.”

The Vice President pointed out that medium scale miners operating in the mineral-rich acreages in the interior locations that benefit from concessions, granted by government, will face the consequences if they are found involved in the racket to export the country’s gold illegally.

An analysis of available statistics, done by this newspaper, found that even with foreign gold companies announcing mega gold finds, declarations to the Guyana Gold Board have been declining since 2017.

According to the Bank of Guyana (BoG) Annual Report for 2022, the total gold declarations last year declined by 2.5 percent to 486,415 troy ounces (oz).

Meanwhile, in 2021 and 2020, declarations were 499,054 oz and 585,433 oz respectively.

In 2019, the gold sector had performed better with declarations amounting to 641,828 oz.

Further, for the years 2016, 2017, and 2018, notable decreases were recorded; a total of 712,706 oz, 653,753 oz, and 613,073 oz were recorded respectively.

Notably, in the first quarter of this year, the trend continued with the Bank of Guyana reporting a contraction of 5.3 percent in declarations when compared with same period last year. This publication understands that the declarations were approximately 110,000 ounces.

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Brazil, declarations, gold, investigation, smuggle

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