Dirty gold overtakes cocaine: illicit mining finance risks for project teams
Reviewed by Tom Sullivan

First reported on MINING.com
30 Second Briefing
Illegal gold mining has overtaken cocaine as a revenue source for some Latin American criminal groups, driven by record gold prices, weaker enforcement and the ability to launder metal into legitimate supply chains using forged paperwork and false identities. FACT Coalition’s Julia Yansura points to the US “hand-carry” loophole—no $10,000-equivalent declaration for gold bars—as a key enabler, while WWF-UK/Themis data show over 80% of surveyed financial institutions face illegal-mining-linked illicit finance risk, yet 40% have taken no mitigating action. Ecuador’s 2026‑2029 National Security Plan now classifies illegal mining as a national security threat, and FACT urges tighter beneficial ownership rules and treating transnational illegal gold mining as a predicate money-laundering offence.
Technical Brief
- US customs’ “hand-carry” loophole allows undeclared physical transport of high-value gold bars across borders.
- Ecuador’s 2026–2029 National Security Plan reclassifies illegal mining from environmental infraction to national security threat.
- Ecuadorian authorities report criminal gangs infiltrating the gold chain end‑to‑end, from pit extraction through export logistics.
- FACT Coalition identifies the US as the largest destination for Colombian gold exports despite pervasive illegal sourcing.
- Estimates cited indicate around 80% of Colombian gold output is illegally or criminally sourced, driving systemic supply-chain contamination.
- WWF‑UK/Themis surveyed 600+ financial professionals in 22 countries on illegal‑mining‑linked illicit finance exposure.
- Survey results show >80% of financial institutions exposed to illegal‑mining risk, yet 40% have no mitigation measures.
- FACT’s safety‑of‑system proposals include stronger beneficial ownership disclosure and designating transnational illegal gold mining as a money‑laundering predicate offence.
Our Take
With Colombia’s illicit gold share estimated at 80%, banks and traders dealing in Latin American gold flows will likely need to move beyond basic KYC to mine‑site and supply‑chain level due diligence, especially as ESG‑screened funds increasingly scrutinise exposure to illegal mining in countries flagged in this article such as Ecuador and Colombia.
Prepared by collating external sources, AI-assisted tools, and Geomechanics.io’s proprietary mining database, then reviewed for technical accuracy & edited by our geotechnical team.
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