A brief report on the radio caught my ear: Germany is planning to repatriate its gold bullion reserves from New York and Paris, having sent them off during the Cold War in order to get them as far as possible from the Iron Curtain. (In case you’re now planning a daring heist while practising your Michael Caine accent, the Germans haven’t announced exactly when or how they are moving the gold: just sometime between now and 2020.) But it started me thinking about laundering through gold bullion – something that is obviously possible, as various jurisdictions have quite recently extended their AML requirements to bullion dealers. (Pedantic fact alert: bullion can be any precious metal, so silver, platinum, etc. as well as gold – and the word comes from the French “bouillon”, meaning broth. Oh, and boiling – as in melting the metal.)
The main strengths of gold – its universal appeal and its portability/value ratio – make it attractive as a way to move value around, and indeed it is a mainstay of the parallel economy (as exemplified by the numerous hawala-style banking systems – which, we must remember, are not illegal in many countries, but are almost never regulated). Of course, criminals have not been slow to see the potential. The ongoing case of Oron turns on whether the company’s owners have stashed away the proceeds of crime – in this instance, alleged profits from copyright infringement in the adult movie business – in gold bullion. And in November 2012, Italian police disrupted a criminal gang who were using money from Switzerland to buy stolen gold and silver, and melting it down into bullion bars that were then sent back to Switzerland. And the Mafia – never slow to spot a market opening – are taking advantage of the economic downturn to set up cash-for-gold shops, buying jewellery at knock-down prices, melting it down, and then using it to buy whatever criminal organisations want to buy. Perhaps a trio of Minis.
Just as I was writing this post, I spotted this story on the Beeb – imagine digging up a 5.5kg nugget of gold! In fact, I don’t think the word “nugget” is entirely appropriate – it’s more of a chunk or lump really.