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Dirty
       Gold

Dirty gold from the Amazon in Swiss banks

Sandra Weiss

from

Gold prospectors have sold 25 tonnes of gold from the Amazon region in Switzerland in the past year.

Gold counts as one of the most secure investments for European investors in the current crisis. In the year 2006 the ounce cost 525 dollars, this year it is worth 1500. Yet hardly anyone who has an ingot lying in the safe-deposit boxes of the banks wonders where the precious metal comes from. Perhaps from the Peruvian jungle? Gold prospectors have sold 25 tonnes of gold from the Amazon region in Switzerland in the past year – investigations into money laundering and tax evasion are at present ongoing in Peru. A lucrative business.

 

But the consequences of the gold boom are devastating: thousands of hectares of cleared rain forest, poisoned rivers, exploitation, prostitution. Sandra Weiss has looked around on the spot.

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Promise and damnation lie close together at Madre de Dios in the Peruvian Amazon: the millionaire beach borders Laberinto (the Labyrinth), the paradise at the “little hell”. Names written by gold. For centuries the fine, glittering dust has accumulated in the sand of the rivers of the Amazon basin. Washed out from the bowels of the Andes by crystal-clear rivers, over perilous waterfalls and through deep ravines torn right down into the tropical lowlands where the wild, icy floods turn into lazy, muddy tropical rivers. These grind the gold into a fine powder that they deposit somewhere in the heavy, dark sand. Nowhere else is there such fine and pure gold as here. The gold price has never been as high as it is now. And that is the tragedy of Madre de Dios.

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Here and there the species-rich rain forest has changed into a sandy desert, a lunar landscape perforated by craters and flanked by tree skeletons.

Here and there the species-rich rain forest has changed into a sandy desert, a lunar landscape perforated by craters and flanked by tree skeletons. And right in the centre are collections of shabby wooden huts sealed against the rain with blue plastic sheeting: gold-miner camp-sites. Nomadic settlements on demand. There is no drinking water, no electricity, no schools, no roads – but there are improvised supermarkets, pharmacies, gas stations, bars and brothels. And for those who wish, the overpriced offer can be weighed against gold.

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Adán Quispe* stands knee-deep in a sand crater, 10 meters deep, 80 meters across. Beads of sweat run down his athletic, naked upper body. He is stung by mosquitos and a few wounds are inflamed. He is used to the bitter cold of the Andean highlands, and the brooding heat of the jungle wears you down. However, this doesn’t count for much now. With great concentration the prospector sucks damp sand into a funnel with a hose under the deafening noise of the diesel generator. Here the sand is displaced with water and trickles a few meters behind onto a kind of slide covered with stringy carpet. “Chupadera”, the sucker, is the name given to the machine invented here by the gold prospectors. What stays suspended in the carpet is “arenilla”, the heavy, dark sand in which the gold dust is hidden. It is scarcely visible to the naked eye. Just sometimes the sun conjures a seductive, fleeting glitter.

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It is scarcely visible to the naked eye. Just sometimes the sun conjures a seductive, fleeting glitter.

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The sand is removed from the carpet with brushes and transferred into buckets with mercury which bind with the gold. Adán impatiently stirs with his bare hands in the little sieve of natural fibres in order to speed up the process. He heats the lumps afterwards with a kind of Bunsen burner to evaporate the mercury again. That is the magical moment when everyone pauses. So many hopes rest on the shapeless yellow something, at times as small as a coffee bean, at times like a quail’s egg!

The dream of your own home, of a car, of courses of study for the children. But many a dream lasts only for a few hours; many a fortune has been just as quickly squandered, wasted on booze and spent on prostitution or violently snatched away. Many a corpse has been buried anonymously in one of the many craters. As a tribute to the gods is what the prospectors believe. So that mother earth will show herself to be continuedly generous.

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The precious metal draws everyone in its wake: the poor devil from the highlands just as much as the escaped felons, the drug mafia, the bosses of Asian triads and even the native people of the Amazon who prospect in their tribal area. Environmentalists denounce also the multinational mining concerns who are said to buy up the illegal gold – and then export it legally. Up to 600 soles, around 180 euros, is what Adán can earn per day with his hard graft. More than a judge or a minister. And in Peru there is lot of gold: 2.5 billion dollars is what the exports have brought in; this Andean country is the sixth largest gold producer worldwide. In the course of the gold rush the provincial city of Puerto Maldonado has grown by 40% in only five years. Importers of dredges and trucks like Yamaha and Caterpillar make sales of millions in the nest of the virgin forest where, until a year ago, there was not even a tarred road leading in. More than 50,000 farmers and day labourers have come from the highlands into the green hell of the Amazon. Desperate fathers and unscrupulous adventurers who have nothing to lose. Just like Adán.

More than 50,000 farmers and day labourers have come from the highlands into the green hell of the Amazon.

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For him, time is gold. The 25-year-old toils on commission in 24-hour shifts. If he finds something he gets 25%, the rest goes to the owner of the concession, who uses it to pay for the maintenance of the machines and provides the fuel and the food. Adán finds eight grams on good days. Sometimes half a kilo – but maybe also nothing at all.

The river beds are treacherous and change their course from year to year. Where today there is virgin forest, there was maybe a river 50 years ago. In order to find this out, one must fell the trees and dig up the earth. 32,000 hectares of virgin forest in the region have already been cut down. “There are hardly any fish still and the few left are inedible because of the heavy metal pollution”, warns César Ipenza from the environmental organisation SPDA: “the gold from the Amazon area carries with it exploitation, prostitution and environmental degradation.”

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In the meantime, the prospectors stand before the gates of the greatest natural park in Madre de Dios, and finally the government has heard the alarm signals. “He’ll grab the bull by the horns now,” announced the president Ollanta Humala. In the past months the military has destroyed machines by the dozen, rationed the supply of fuel, forbidden the purchase of gold and cleared the prospectors’ campsites. There were protests, three dead – and a few acknowledgements about the illegal trades which branched off even into Europe.

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In particular, such companies as Oro Fino and UMT exporter were scrutinised for being the middlemen. The newspaper “El Comercio”, relying on documents of the public prosecutor, reports that UMT is alleged to have used the KLM airline to illegally fly more than 19 tonnes of gold with an equivalent value of US $900 million into Switzerland past the tax authorities, and to have transferred it to the company MKS Finance in Geneva. In 2011, Oro Fino is said to have delivered four tonnes of illegal gold into Switzerland in the name of AS Peru&Cia, and the receiver is said to have been the firm PAMP in Geneva, a subsidiary of MKS.

“The gold from the Amazon area carries with it exploitation, prostitution and environmental degradation.”

It was investigated, for example, whether the business partners had been black-listed for money laundering or terrorism.

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The exporters are now threatened with eight years imprisonment because of money laundering and tax evasion. For the time being, the public prosecutor has not made a legal pronouncement against the Swiss. The firm MKS explained when questioned that it knew nothing of the charges and strove for the greatest possible transparency when purchasing gold. It was investigated, for example, whether the business partners had been black-listed for money laundering or terrorism. However, the businesses with Peruvian partners are said to have complied with valid government regulations, especially regarding the provenance from legal mines. Nevertheless, at present the senior management is verifying all the information and the business relationship with the partners in Peru.

*Name changed by request