Harley Sandoval, an evangelical pastor, real estate agent and mining entrepreneur, was arrested in July 2023 for illegally exporting 294 kilos of gold from the Brazilian Amazon to the United States, Dubai and Italy.
On paper, the gold came from a legal deposit that Sandoval was licensed to mine in the northern state of Tocantins. But police said not an ounce of gold had been mined in this region since colonial times.
Using cutting-edge forensic technology and satellite imagery, Brazil’s federal police said they were able to establish that the exported gold did not come from the Tocantins deposit. Rather, it came from three wildcat mines located in the neighboring province of Pará, some of which were on protected indigenous reserves, according to unpublished court documents dated November 2023 and seen by Reuters.
This trial is one of the first in Brazil to use new technology to combat clandestine trade, which could represent up to half of Brazil’s gold production, one of the main producers and exporters of the metal precious. Illegal gold mining has expanded at thousands of sites in the Amazon rainforest, leading to environmental destruction and criminal violence in the region.
Seizures of illegally mined gold have increased sevenfold over the past seven years, according to federal police records obtained exclusively by Reuters.
Mr. Sandoval, who was released pending trial and continues to preach with his wife at an evangelical Pentecostal church in the central Brazilian city of Goiania, denies the allegations. He says there is no way to establish where the gold was mined once it was melted into bars for export.
“It’s impossible. To export gold, you always have to melt it down,” he told Reuters by telephone.
THE DNA OF GOLD
Historically, gold is notoriously difficult to trace, especially once metal from different sources has been melted together, erasing the original signatures. Then it can easily be traded as a financial asset or used in the jewelry industry.
But investigators say that’s starting to change. A police program called “Targeting Gold” creates a database of samples from across Brazil, which are examined using radioisotope scanners and fluorescence spectroscopy to determine the unique composition of the elements.
This technique, long used in archaeology, was pioneered in the mining sector by Roger Dixon, a geologist at the University of Pretoria, to help distinguish legal gold from stolen gold.
The program developed in partnership with university researchers includes the use of powerful light beams from a particle accelerator in a Sao Paulo laboratory to study nanometer-sized impurities associated with gold, whether dirt or other metals such as lead or copper, which help trace its origins.
Humberto Freire, director of the federal police’s recently created Environment and Amazon Department, said the technology allowed scientists to analyze “the DNA of Brazilian gold.”
“Nature has marked gold with isotopes and we can read these unique fingerprints using radioisotope scanners,” Freire said. “With this tool, we can trace illegal gold before it is refined for export.
The program has contributed to the increase in gold seizures since left-wing President Luiz Inacio Lula da Silva took office last year, with a 38% increase in 2023 compared to 2022, according to figures from the government seen by Reuters. New gold market regulations from the Brazilian central bank, including mandatory electronic tax receipts for all transactions and increased monitoring of suspicious transactions, have also helped, according to Freire.
“We estimate that around 40% of the gold mined in the Amazon is illegal,” he told Reuters. Brazil exported 110 tonnes of gold in 2020 worth $5 billion, according to official data, ranking among the top 20 global exporters. Last year, exports were 77.7 tonnes, a decline the government attributes to improved enforcement of illegal mining.
INDIGENOUS TENSIONS
Lula’s predecessor, far-right President Jair Bolsonaro, weakened environmental controls in the Amazon.
That sparked a new gold rush in Brazil, spurred by record global gold prices, which were pushed higher by geopolitical tensions and central bank buying, led by China.
Prices continued to reach new highs, trading at around $2,650 per ounce on Friday.
Gold rushes have been a feature of mineral-rich Brazil since its Portuguese colonial past. But the latest wave of wildcat mining, which began under Mr. Bolsonaro’s administration, is unprecedented. Satellite images show that there are some 80,000 such prospects in the Amazon rainforest today, more than any previously recorded.
Once dominated by prospectors with pans, artisanal mining in Brazil has become an industrial-scale activity, with heavy excavation machines and river dredges worth millions of dollars. Criminal organizations move people, equipment and gold in and out of the region using helicopters and planes that land on clandestine airstrips.
Their excavations often leave behind gaping pools of sludge contaminated with mercury, used to separate gold from soil and other minerals.
Last year, thousands of miners invaded Yanomami territory, the country’s largest indigenous reserve, located on Venezuela’s northern border. Violence and disease caused malnutrition and a humanitarian crisis within the tribe, prompting Lula to send in troops.
But many returned this year after the army withdrew. Lula, who has pledged to eradicate illegal gold mining, tried to fight back by deploying special forces from the Ibama environmental protection agency to indigenous reserves and forest conservation parks.
Police say cracking down on organized crime gangs that support illegal miners is the next step to ending an illegal trade that fuels Switzerland’s jewelry and watch industry, which buys 70% of the gold exported by Brazil, according to government trade data.
Neighboring Amazon countries, including Colombia and French Guiana, are considering adopting the Brazilian method of gold analysis to combat their illegal gold trade. European governments have expressed interest, including Switzerland and Britain, which are the main importers of Brazilian gold after Canada, according to police and diplomats.
Brazil represents only 1% of the gold imported by Switzerland, the hub of global trade in this metal, and “measures are in place to only import legally mined gold”, according to a press release from the Swiss embassy. The embassy said it had set up a working group with other importing countries to study traceability and anti-counterfeiting tools.
A 2022 study by the nonprofit watchdog Instituto Escolhas found that 52% of gold exported from the Amazon was illegal, with almost all coming from protected indigenous reserves or national conservation parks .
A vibrant lobby for informal gold mining has outlasted Bolsonaro in Brazil’s conservative Congress, where pending bills propose legalizing wildcat mining.
For now, however, gold samples from all over Brazil are being added to a database with the help of scientists from the laboratory of the Institute of Criminology of the Federal Police in Brasilia, where the medical expert -legal Erich Moreira Lima supervises the microscopic analysis of gold nuggets kept in a safe.
“Now that we have a team in place, we hope to analyze the 30,000 gold samples collected by the Brazilian geological survey. In a few years, we should have mapped the 24 gold-producing regions of Brazil,” he said. -he declared to Reuters.
Geologist Maria Emilia Schutesky and her team at the Geosciences Laboratory at the National University of Brasilia are analyzing gold samples using mass spectrometry to identify associated molecules, such as lead, and determine the origin of the gold. ‘gold.
“We, the researchers, seek to trace the gold 100%, but this is more than the police need to prove a crime, that is to say to establish that the gold does not come from where the suspect claims he is coming from,” Ms. Schutesky said.
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