Venezuela: Anti-Corruption Probe Counters Gold Smuggling in State-run Corporation

According to authorities, the arrest of the number two at Venezuela's state mining company reportedly prevented 2.5 tonnes of gold from being smuggled out of the country. 

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The “Metal Hands” operation looks to counter the illegal smuggling of gold, silver, and bronze out of Venezuela
The “Metal Hands” operation looks to counter the illegal smuggling of gold, silver, and bronze out of Venezuela. (Archive)
By Paul Dobson
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Merida, June 25, 2018 (venezuelanalysis.com) – Venezuela’s attorney general, Tarek William Saab, has announced another high-profile arrest as part of an ongoing anti-corruption drive overseen by his office.

Doarwin Alan Evans, who was vice-president of the state-run General Mining Company of Venezuela (MINERVEN), was arrested in El Callo in the southeastern, mineral-rich state of Bolivar and will be charged with the trafficking of strategic materials and aggravated smuggling. Evans is a member of the ruling United Socialist Party (PSUV).

According to Saab, the bust allegedly prevented 2.5 tonnes of gold from being smuggled out of Venezuela through an “[illegal mafia] network dedicated to the purchasing of gold from the small miners.”

Following Evans’ arrest, it was also announced that Jose Edgardo Leon Parra, head of business for private sector firm Tesoro de Dios Investment in El Callo, was also detained as part of the same investigation.

The “Metal Hands” anti-corruption operation was launched by the government this past June 8 with the reported intention of preventing illegal extractive smuggling of strategic metals, particularly gold, silver, and bronze. It coordinates closely with the “Paper Hands” investigation rolled out in May, which looks to combat currency smuggling and related corruption networks.

Following these arrests, Attorney General Saab revealed that since the start of the “Metal Hands” probe nine citizens have been detained, 39 arrest warrants released, 23 vehicles seized, 30 search warrants issued, and 31 red alerts have been processed by Interpol.

MINERVEN groups numerous micro-mining firms and forms part of the state-run Venezuelan Corporation of Guyana, which is likewise headquartered in Bolivar. Nationalised in 1974, the basic industries conglomerate forms the foundation of the state industrial sector. Since the 2016 launch of the controversial government-led Mining Belt project, which looks to regulate and expand open-pit mining in conjunction with national and transnational firms, the role of MINERVEN has increased.

Home to some of the world’s largest gold reserves, Venezuela’s southeastern region has long been the site of unregulated and often illegal private micro-mining which takes advantage of the country’s extensive and largely uninhabited borders with Brazil, Guyana, and Colombia to smuggle the products to higher-value markets. Such practices have been widely denounced for not only preventing gold and other minerals from flowing into public coffers, but they also form an obstacle to tax collection and labour place regulation.

However, corruption in the high-value industry runs deep, with low waged public-sector employees or military staff frequently tempted by the lucrative gold-smuggling business, especially in the context of the country’s current economic crisis.

“We are confronting the gold smugglers with a hard hand,” stated head of the National Office for Mining Inspection and Checks (ONAFIM), Higinio Benitez, following the arrests. “With these actions we can start to regulate the price of gold which was being distorted by these mafias,” she went on to comment.

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