Friday, April 17, 2020

Gold the Ferrari of money laundering - Peter Ferrari

NTR Metals is the largest money-laundering prosecution involving precious metals in U.S. history. “The scope of the conspiracy is enormous,” prosecutors told a judge during a hearing in Miami in 2017. Federal prosecutors charged 3 NTR traders with money laundering, saying the three men bought $3.6 billion of illegal gold from criminal groups in Latin America.

The scandal shut down NTR and cost its Dallas-based parent company, Elemetal, the ability to trade gold on bullion and commodity exchanges.
Prosecutors claimed the gold traders, who eventually pleaded guilty, fueled “illegal gold mining, foreign bribery [and] narcotics trafficking.”
Pedro Pérez Miranda - Peter FerrariIn 2012, the company did little business in Latin America. But the next year, NTR struck a rich vein, becoming the largest U.S. importer of Peruvian gold with $980m worth of deals. They did it with help from Peruvian businessman Pedro Pérez Miranda, who is suspected of laundering massive amounts of drug money through the gold trade.

Over the past two decades, as the U.S. war on drugs undercut the cash flow of narco-traffickers, dealers diversified into Latin America’s gold industry. By using drug profits to mine and sell gold, criminals can launder staggering amounts of money.
In 2013, NTR went on to buy $400 million in gold from Ferrari
NTR’s Peruvian operations collapsed at the end of 2013 when police raided a storage facility outside Lima holding gold that belonged to Ferrari and others. Agents seized $18.8m worth of gold. But the party wasn’t over — it moved. In 2014, NTR was smuggling gold across the border to Ecuador and Bolivia. Illegal mining has devastated the rainforests of Colombia, Peru, and other gold-producing nations.
When local governments in those countries also began cracking down the party moved again, this time to Colombia. In 2015, NTR’s imports from Colombia soared to $722m. That accounted for more than half of the country’s gold exports to the US. Colombia exported 64 tons of gold in 2016, much of it to the United States. That same year, Colombia’s large-scale, legal mining operations produced only eight tons.

A large part of the gap between what Colombia’s big mines produce and what the country exports is unlicensed and untaxed gold — often unearthed at any cost by operations controlled by narcos.
Cartel associates pose as traders to buy and mine gold. Cocaine profits are seed money. They sell the metal through front companies to refineries. Once the deal is made, the cartels have turned their dirty gold into clean cash. To the outside world, they’re not drug dealers; they’re gold traders.