Drug gang exploits gold as money-laundering tool

“If I had a lot of money to launder, I would choose gold,” says John Cassara, a former Treasury agent and author of books on money laundering. “There really isn’t anything else like it out there.”

And at least one international organization has begun moving money on a river of molten gold: the Sinaloa drug cartel.

The cartel used some proceeds from selling drugs in the U.S. to buy gold in pawn shops, according to allegations in court records.

It shipped more than $98 million in gold to a Florida company that had it melted down and sold for cash. Then the cartel used fake invoices to justify sending the proceeds to a company in Mexico.

Court documents, plus interviews with people familiar with the scheme, paint an unusually detailed picture of how gold can be used to hide an illicit money transfer.

Once it’s melted down, the commodity’s origins are difficult to trace and it can quickly be converted to cash.

— Bloomberg

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