UK and US latest sanctions take aim at illicit gold trade

London/Washington — The US and Britain on Monday announced a new wave of sanctions targeting what it said was the illicit gold trade, which the UK said was financing Russian President Vladimir Putin’s war efforts in Ukraine and fuelling corruption.

The UK government froze the assets of four individuals it said were involved in smuggling gold and one other it said had bought more than $300m worth of Russian gold and, by doing so, provided revenue to the Russian government.

“Illicit gold is an assault on the legitimate trade of a valuable commodity, fuelling corruption, undermining the rule of law, and entrenching human rights abuses such as child labour,” the British Foreign Office said in a statement.

“Russia uses the illicit gold trade to launder money and evade sanctions, in doing so bolstering Putin’s war efforts.”

The Russian embassy in London did not immediately respond to a request for comment.

Britain and other major Western economies banned the import of new Russian gold in 2022 after Russia’s invasion of Ukraine. Russia has since found other markets in which to sell the gold it produces.

Last week Britain, working in concert with the US, said it had disrupted a global money-laundering ring used by rich Russians to evade sanctions.

The US on Monday imposed sanctions on dozens of businesses and people it said were involved in a global gold smuggling and a money-laundering network based in Zimbabwe, the US Treasury Department said in a statement.

The sanctions targeted Kamlesh Pattni, who the Treasury said befriended Robert Mugabe when he was president of Zimbabwe and engaged in a scheme to generate cash by selling the country’s natural resources in foreign jurisdictions and overreporting the amount of cash being brought back, which they received compensation for.

The UK also designated Pattni on Monday.

The US Treasury said Pattni’s network spanned several countries, including entities in the UAE, Singapore and Kyrgyzstan.

The action marked International Anti-Corruption Day, the Treasury said.

Alongside the latest sanctions, the British government appointed a new “Anti-Corruption Champion” to help co-ordinate efforts between parliament, the private sector and civil society to clamp down on all forms of corruption.

The role was given to Margaret Hodge, a former legislator in the governing Labour Party who has spent much of her 30-year political career campaigning against domestic and international corruption. She is now a member of the House of Lords, Britain’s upper parliamentary chamber.

Britain will publish a new anticorruption strategy in 2025.

Update: December 9 2024
This story has been updated with new information.

Reuters