Mints in both countries receive the metal from a North American contractor who mixes dirty gold with domestic supplies, the investigation claims
The US and Canadian government mints have for years sourced coin gold from mines controlled by Colombia’s Clan del Golfo drug cartel, despite vowing that all the precious metal is extracted on domestic soil, according to an investigation by the New York Times.
The US Mint says its coins are produced “to connect to the founding principles of our nation,” and federal law requires its gold to be sourced domestically. However, the process is “based on a lie,” the NYT wrote.
The newspaper said it traced hundreds of millions of dollars’ worth of foreign gold entering the Mint’s supply chain. Some of the metal was second-hand and of unknown origin, while some came from countries such as Colombia and Nicaragua, where parts of the gold industry are controlled by criminal groups.
Some of the gold originates in northwestern Colombia, where large areas are controlled by the Clan del Golfo. Miners there extract gold using mercury, a toxic substance that harms both workers and the environment.
The NYT said that the illegal operation is being carried out with such cavalier disregard of the authorities that some workers were seen extracting gold on the premises of a military base.
Then, the Colombian gold is shipped to Dillon Gage, a Texas-based refiner and one of the main suppliers of the US Mint. The company blends it with American gold, effectively laundering it, the investigation claims. The US Mint does not check the origins of the gold, the NYT added.
When asked about the sourcing, the Mint initially told the NYT that “its gold came entirely from the United States, as the law requires.” However, when presented with the findings, the body backpedaled, saying that the US was its “primary” source of the metal.
The supply chain then extends further north to Canada, the paper said. While the US Mint did not verify the origin of the gold, its Canadian counterpart had vetting procedures in place but continued procurement nonetheless, according to the NYT.
Canadian officials described the gold as “North American,” arguing that the designation reflects the fact that it is mixed in Texas. This classification means the authorities are not required to verify the original source of the metal and instead rely on US checks, the report said.
The NYT added that even if the Canadian Mint did not follow its own guidelines, “it would face no legal consequences” because tinkering with the “North American” designation is not a crime.
The investigation comes as gold has been on an extended record-breaking rally in recent years, largely due to aggressive central bank buying, US Federal Reserve rate cuts, and geopolitical tensions.
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