Lessons from Venezuela’s illicit gold trade applicable to IFFs more widely says Brookings

Difficulties associated with tracing illicit gold flows and the large number of actors involved in gold smuggling have contributed to a crisis with limited chances to even engage in efforts to address the issue of illicit financial flows (IFFs) from the production and trade of gold from Venezuela according to analysis by the Brookings Institution.

The Washington based non-profit public policy organisation says the issue includes the limited availability of trade and customs data, which could help anti-corruption advocates better diagnose the scope and origins of resource flows, and the complex, transnational nature of the problem.

Recommendations widely applicable

Acknowledging those challenges, a group of Brookings researchers has proposed ten recommendations to address IFFs from the mineral trade. These are informed by the expert discussions referenced in their analysis available via the link below.

While these opportunities were identified in the context of illicit gold flows from Venezuela, the researchers conclude that many of them are relevant to combating IFFs more broadly.

Trade and customs data

Amongst their recommendations, the researchers suggest improving trade and customs data that are often inconsistent, inaccurate, or insufficient and, underlining a clear need for cross-border actions, they say there is space for international institutions to help improve data availability and accuracy.

They also suggest stemming enablers of IFFs at the supply chain and regional trade levels, in the case of Venezuelan gold via laundering through key regional transit hubs, particularly Colombia, the Dominican Republic, Brazil, Suriname, Guyana, and Panama.

Investigations, engagement and FTZs

Other recommendations suggest engagement with indigenous communities, capacity building to improve the capabilities of investigative journalists, and coordination with the private sector and all actors along the value chain.

The researchers also suggest an examination of free trade zones (FTZs) as these “serve as enabling mechanisms for both gold laundering and money laundering linked with gold.”

 The Brookings Institution’s analysis, Venezuela’s gold: 10 ways to address illicit financial flows from the mineral trade can be found here.


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