The Gold Smugglers: How a Multibillion-Dollar Network Funds Carnage in Africa

If you want to know the truth, follow the money. It is true of all sorts of shadowy figures across the world, all sorts of illicit industries, all the hidden hands that seek to influence the world or to enrich themselves from it. Whether it is a public corruption scandal, a complex and costly fraud, or an organized ring of criminals lurking in the underworld, everyone can lie—but follow the money, and the money always leads to the truth.

Across the continent of Africa, a hidden web of alliances, smuggling networks, and state and black-market partnerships have long protected one of the world’s most lucrative secrets: the illegal gold trade. Its scale has been well-known for years—revenues to the tune of tens of billions of dollars, money that some among the continent’s rulers have used to wage brutal wars, slaughter the innocent, and enrich themselves while their people starve. But how that network functions, where the gold goes, and how it is converted into cold, hard cash, seemingly without making a fuss, has been a mystery—until now.

Artisanal Mines and the Rise of Illicit Gold

While any serious examination of this subject draws on a wide range of reputable sources, one source in particular stands out: a report by the non-government organization SwissAid, released on the thirtieth of May, 2024, and written after extensive research by two investigators, Yvan Schulz and Marc Ummel. Before examining that report in full, two key questions must be answered: What is the illegal gold industry, and why does it matter? Illegal gold mining in Africa—or, as it is better known, artisanal mining—was not always the massive illicit industry that it is today.

In fact, the practice was not always one that happened illegally, and even today, it can still be legal depending on the nation and the circumstances. The core idea behind the movement was rather simple: that small-scale gold producers, be they locally owned companies, community mines, or whatever else, could mine and sell off gold on their own instead of working for large-scale, typically state-run or international organizations. Typically, they use labor-intensive methods to mine their gold, operations that rely only on basic tools and technologies and use humans to do the rest.

In some places, they have gained legal recognition, like in Burkina Faso, Kenya, and Ethiopia. On paper, it is a fairly good idea; working on, say, a community-focused artisanal mine is a good way to ensure decent labor conditions, or to see that a community can access and leverage the wealth on its own land instead of living off wages paid by the person harvesting it. A combination of weak and corrupt law enforcement, lax or disinterested governments, and the powerful financial incentives that come with controlling gold production, has meant that artisanal mines that do start up with good intentions have a target on their backs from day one.

Faced with gangs, militias, and other organizations who want their mines and have the means to take them, it is exceptionally rare that small-scale miners have been able to fight back. And with the artisanal mining industry taken over, these organizations have had all the reason in the world to expand production, starting new mines and industrializing the ones they have got in order to extract as much profit as possible.

Criminal Control and the Structure of the Gold Trade

How these groups interact with their respective national governments depends on where they are and what regime they are living under. In some African nations, like Ghana or Tanzania, national governments are known to complain about and even condemn the miners exploiting their lands, even if they lack the means or political will to address the issue. In places like that, local officials are often a convenient asset for artisanal miners to stay out of reach of the law, especially in parts of the world where a bribe paid from even a paltry fraction of the year’s mining revenues is enough to make a person far richer than anybody else they know.

In other places, like South Africa, miners place themselves directly at odds with local governments and take violent action when it suits them. South Africa’s illegal miners, called zama zamas, have been known to take over mines, defend their illegal operations there by attacking police and local security, and even attack journalists who have attempted to expose the practice. In other places, like the Central African Republic and the Democratic Republic of the Congo, these operations are believed to operate in a way directly complicit with the national government.

The specifics of how the mining groups themselves function will typically vary, but the fundamental industry structure is at least relatively predictable. The Minerals Council of South Africa summed it up as follows, attempting to explain how that particular country’s zama zamas do their business. The miners themselves, working in the mines and the pits, are at the bottom of the hierarchy—simple foot soldiers driven into doing the brutal work involved with extracting gold at large scale.

The bosses and the gangs that run the mines are the ones in control, quickly taking possession of the gold that the mines produce, and starting it along the process involved with turning a profit. Gold then goes to third parties who buy it in bulk, either regionally or nationally, and those bulk buyers transfer it to front companies, which provide the legal cover to engage in exports. Then, someone comes along from abroad looking to buy, and the lucrative sale of gold takes place.

The process of laundering the gold for Western buyers has even involved large-scale forgery, taking this smuggled gold—which is already of high purity by the time it is pressed into bars—and labeling it with the seals of well-respected Swiss refineries in order to pass it off. Through these forgeries, smuggling organizations can circumvent global regulations meant to keep gold that funds wars, terrorism, environmental damage, or political upheaval, off the legitimate market. Said one gold executive, then-CEO of Australia’s Perth Mint, of the problem: “It’s a wonderful way of laundering conflict gold.

The gold is genuine, but it’s not ethically sourced … They look completely genuine, they assay correctly, and they weigh correctly as well. Because gold is completely fungible, you can bleed it into genuine production.”

Human Cost: Child Labor, Poison, and Dictatorial Rule

Even if this industry is illegal, why should any of that matter to a person halfway around the world? Illegal things happen every day, in every place, and the world moves on. Unfortunately, with the lawlessness and exceptionally high profit incentives of the artisanal gold industry comes a stunning range of abuses perpetrated in the mining process.

For the people who work the mines, few are paid anything resembling a fair wage for their effort, and many work under heavy armed guard from gangsters who are just as happy to enact violence upon them as in defense of the mines. Many are children, who are, in some cases, even sought after for their ability to work with small holes and crevices. Working conditions are often dangerous and entirely unregulated, with potentially deadly problems like methane buildups and mine collapses often not guarded against.

It is not uncommon for laborers not to be paid at all, and with the host communities around the mines firmly in the pocket of the syndicates that control them, ordinary people in their path often face a small-scale version of dictatorial rule. Even in places where criminal syndicates are less overbearing, and it is possible to make a good life mining for gold—as millions do across Africa—the methods used to mine the gold have ruinous side effects, poisoning soil and water with potentially deadly chemicals. Those chemicals are not particularly obscure or complicated; instead, these miners use the basics—mercury, cyanide, and others.

Nationally, smuggling networks rob struggling countries of a critical revenue stream, while those leaders that choose to make deals with the miners and take their cut are strongly incentivized to use authoritarian and often despotic tactics to keep a tight hold on their population—and thus their source of both national and personal enrichment. The general scale and effects of the artisanal gold industry have been known for some time. A Reuters investigation in 2019 found that the United Arab Emirates, a prime importer of gold both then and now, seemed to be importing vast sums of gold that the official export numbers of African nations could not account for.

In 2016, the UAE imported over fifteen billion US dollars worth of gold—some 446 tons—but when Reuters asked official, industrial mining organizations across Africa where they sent their gold, they were not sending it to the Emirates, meaning that somebody else, the illegal side of the industry, was the likely culprit. Per that investigation, nearly four billion dollars’ worth of gold—about sixty-seven tons—found their way to the Emirates through means that were not accounted for, primarily from Mali, Tanzania, Ghana, Togo, Cameroon, and Benin.

The SwissAid Report: $30 Billion in Smuggled Gold and the UAE Pipeline

The SwissAid report’s results are nothing short of staggering. Per the report, the year 2022 saw thirty billion US dollars’ worth of gold smuggled out of Africa, equivalent to over 435 metric tons, representing a doubling in the value of smuggled gold in just the prior six years. Of all the gold that the report assessed was produced in Africa, anywhere between thirty-two and forty-one percent of it was entirely undeclared, with the highest national producers of gold including Ghana, Mali, and South Africa.

Nine African nations were estimated to produce over twenty tonnes of illicit gold per year. The report was rightly careful to emphasize that not all this gold is controlled by criminal syndicates or mined under duress. As the authors wrote: “In many national contexts, the majority of artisanal miners are simply seeking to earn a living, have no choice but to work informally and have no criminal intent.”

Yet while that is certainly true, it is all but impossible to establish figures for just how prevalent that artisanal mining is when compared to more exploitative methods. While still in Africa, much of the gold moves to transit countries, where local refineries and dealers can add another layer of uncertainty about where a certain shipment of gold came from and the conditions under which it was mined. And as for where those hundreds of tons of smuggled gold end up, the answer is almost always the same: the United Arab Emirates.

Declared gold exports from Africa tend to be transited to the UAE as well, along with other nations like Switzerland and India, where refinery infrastructure exists to process and purify it for the global market. But when it comes to the undeclared gold, almost all of it flows into the UAE, either going directly, or, in a relatively large share of cases, being transited through a neighboring African country before then being shipped out. Of the 435 metric tons of smuggled gold the report counted in 2022, all but 30 tons ended up in the Emirates, and the total amount smuggled across the prior ten years was far higher—nearly 2,600 metric tons, roughly equivalent to 115 billion US dollars in value.

Out of all the gold the Emirates listed as imported in 2022, sixty-eight percent came from nations designated conflict-affected and high-risk, including nations like Sudan and the DRC that have since descended into major conflict. That gold is often smuggled in personal luggage to the UAE by plane, or flown on private jets that depart from transit nations in the gold smuggling trade, like Kenya and Uganda, before reaching Emirati airports—and primarily, the Dubai International Airport.

Switzerland’s Loophole: How Conflict Gold Gains Legitimacy

The real revelation of the SwissAid report answers the question that has gone unaddressed through years of global scrutiny: where does all this smuggled gold, conflict gold, end up after it transits through the Emirates? The answer is predominantly Switzerland, the same nation that the SwissAid organization behind the report calls home. Switzerland is the world’s leading hub of the international gold trade, home to no fewer than five major refineries, importing thousands of tonnes of the stuff per year and processing most of it.

But Switzerland also happens to have a loophole, because although countries like the United Arab Emirates produce zero gold of their own, the location of production is not the measure Switzerland uses to classify the origin point of its gold imports, or decide what gold does or does not meet its standards for ethical importing. If gold is imported to Switzerland by way of a certain nation, then according to Switzerland’s current way of doing things, that is where it came from—meaning that all this gold, once imported to Switzerland from the UAE, is washed of its point of origin and brought firmly into the world of legitimate gold trading. This is a process where it is not much of a surprise that it went unnoticed for so long.

Switzerland imports plenty of its own gold direct from Africa, including 267 tonnes in 2022, all of which moves through the legal side of the gold industry to get there. Yet, look at the fringes of Switzerland’s import data, and small gold producers like Eritrea, Niger, and Gabon drop off the map over the span of a few years. So do nations where gold had previously been sold off after transit: Benin and Togo.

From 2012 to 2022, the number of African nations that Switzerland imported its gold from took a nosedive, at the same time that Swiss imports from the UAE have gone through the roof. Officially, Switzerland only takes a very small proportion of its gold imports from artisanal mines, on the order of just tens of kilograms a year for certain refineries. And not only is the UAE an apparent pipeline for gold transit to the Swiss, but so is South Africa, from which Switzerland imports amounts of recycled gold that go way beyond what South Africa should have in its legitimate recycled-gold market.

In Switzerland, regulators are not required or expected to conduct due diligence around assessing the conditions in which gold was initially mined if it has since been sent off to an intermediary—an issue that even the Swiss Federal Audit Office has pointed out in the past but that has since gone unresolved. Once that gold enters Switzerland, it is treated across the world with all the legitimacy and global trust that the country’s gold industry has built a reputation for. Switzerland imported some ninety-five billion dollars’ worth of gold in 2022 but exported even more than that, at just a hair over a hundred billion.

It is the world’s largest gold exporter, and gold is the product it exports the most of, with China, India, Turkey, the US, and Germany making up a majority of its export customers.

Funding Wars: Sudan, the Wagner Group, and Global Conflict

The conduit of gold that runs from war-torn regions of Africa, to the Emirates, then to Switzerland, and then the rest of the world, is a laundering mechanism that accounts for tens of billions of dollars in the global gold market—trade value that eclipses the entire GDP of nations like Iceland, Lebanon, or Armenia, and dwarfs the world’s humanitarian-aid figures sent to the countries most in need. On the local level in Africa, the pipeline from generating money from mining and selling gold to having money with which to pursue other aims is a fairly obvious one. In many areas, the gold trade is a mechanism to prop up and perpetuate the same groups that enable artisanal mining in the first place: the gangs, the criminal networks, and the corrupt local governments that make it happen on the ground floor.

Gold-trade money often finds its way into the hands of terror organizations, particularly those in the Sahel and the African Horn that have the capacity to operate transnationally and can control and exploit local communities as they see fit. Other times, the money passes into the hands of dictatorships or military juntas, ones that have all the incentive in the world to rely on artisanal mining practices rather than form a legitimate stake in the above-board mining industry. In the Sahel, criminal organizations rely on the gold trade partly because of its ability to keep them relatively anonymous.

Making payments by wire transfer can be tracked; even bills are serialized; but gold, especially in its raw, unrefined form, bears no traces of ever having been used in a transaction. That enables them to freely take part in the other forms of crime that the Sahel has recently become so known for: human trafficking of migrants and international terrorism. Violent takeovers of artisanal mines are common, and fatality counts well above 100 for a single takeover incident are not unheard of.

In the current war across Sudan, gold is among one of the most precious resources to both sides—the Sudanese military dictatorship and a rival paramilitary faction called the RSF. Control over gold mines has become a primary driver of the conflict, and the RSF in particular depends on gold to fund itself. As one UN report stated: “Complex financial networks established by RSF before and during the war enabled it to acquire weapons, pay salaries, fund media campaigns, lobby, and buy the support of other political and armed groups.”

The RSF’s links to illegal gold smuggling have granted it an ally in the United Arab Emirates, where much of the organization’s money is held and from where many of the organization’s weapons and supplies are smuggled in. The UAE denies supplying either side of the war. On the other side, the governing military junta has taken many steps to obscure its gold sector from view since its 2021 takeover of the nation.

In 2020, Libyan sources revealed to the United Nations that large numbers of Sudanese militants had been recruited from gold-mining sites.

From the DRC to Nigeria: Gold-Fueled Violence Across the Continent

Stories like Sudan’s are common up and down Africa. In the Democratic Republic of the Congo, artisanal mines go far beyond just gold, and they fuel the intense violence, the rampant corruption, and the lawlessness that is common across much of the nation. Across the country, and especially in the east, rebels and militias charge crippling taxes on miners in order to allow them to operate, while raiding the mines, stealing gold, and extorting the people there as they see fit.

In Burkina Faso, kidnappings and mine takeovers are common, as Islamist militants fight with criminal organizations and the government for control over the precious resource. In Niger, not only is outright violence over the mines relatively common, but so are industrial accidents like deadly cave-ins and release of chemicals that poison animals and communities at large scale. And in northwest Nigeria, battles have been waged over gold mines for some time, in a multi-sided conflict that even the relatively powerful Nigerian government has little means to address.

Then there is the Wagner Group, and the way that Africa’s conflict gold has fueled the Russian war on Ukraine since nearly as soon as it began. Per a late-2023 brief by the Consumer Choice Center, named the Blood Gold Report, the Wagner Group has been responsible for laundering some two and a half billion dollars to Russia at a minimum. The Wagner Group has been deeply entrenched across Africa since even before the war began, operating as a semi-clandestine, unofficial Russian occupation by mercenaries who are willing to go to extreme, exceptionally brutal lengths to extract resources.

In Sudan, Wagner shell companies process harvested illicit gold and smuggle it out, laundering it through the same convenient, UAE-centered trade network that works so well for other armed groups. Not only does Wagner help to ensure that gold is mined as quickly as possible, but it also serves as a valuable protection racket, stabilizing the regimes and local groups that control gold mines and taking their cut in return. Wagner’s troops are more than happy to help keep friendly leaders in power, and that is a mission that has continued uninterrupted since the death of Wagner’s leaders in 2023 and the group’s subsequent partial assimilation into the Russian military.

Beyond the UAE: India, Turkey, China, and the Widening Pipeline

The UAE-to-Switzerland pipeline is not the only one that exists around the world. In the same SwissAid report, India was implicated for receiving a likely 200 to 300 tonnes of smuggled gold by air, land, and sea each year, although the sources of the gold smuggled into India are believed to be more highly varied and less easily traced. Turkey is believed to be receiving increasing quantities of smuggled gold, partly because new import limits on the stuff have led previously legitimate importers to try and get their gold in through other means.

During the late 2010s, Lebanon consistently reported receiving more gold than world nations reported sending there. Finally, China has become a prime destination for gold-smuggling chains that are completely unreported in the import-export data of any country, owing to the role of Chinese nationals in Africa who control gold production and transport back to their home nation via smuggling networks fully under their control. When it comes to understanding conflict, it is tempting to look no further than big planes, bigger ships, and soldiers laying down their lives.

But no war has ever been so simple as that, and the conflicts that define the twenty-first century, big and small, have a layer of complexity all their own. Follow the money. In many of the world’s most active conflict zones, in places where atrocities and mass death are all too common, following the money means following the gold—and now, more than ever, the full scope of that trail is visible.

The chain connects the world’s super-banks, its high-end jewelry makers, and the wealth and belongings of the rich and famous into the same conduit as militiamen gunning down children who are too exhausted to keep going back down into their local gold pits.

Frequently Asked Questions

How much African gold was smuggled in 2022, and where did it go?

According to the SwissAid report by Yvan Schulz and Marc Ummel, $30 billion worth of gold—over 435 metric tons—was smuggled out of Africa in 2022, doubling in value over just six years. Of that total, all but 30 tons ended up in the United Arab Emirates. Across the prior decade, nearly 2,600 metric tons worth roughly $115 billion were smuggled there.

How does Switzerland’s classification loophole legitimize conflict gold?

Switzerland classifies gold by the country from which it is imported, not by where it was originally mined. Since the UAE produces no gold of its own, African conflict gold that transits through Dubai is recorded as UAE-origin when it arrives in Switzerland. This washes the gold of its true provenance and grants it full legitimacy in the global market, allowing it to be processed by Swiss refineries and sold worldwide.

How does the illegal gold trade fund armed conflict in Sudan?

Sudan’s RSF paramilitary depends on gold to fund itself during the war. According to a UN report, complex financial networks established by the RSF before and during the war enabled it to acquire weapons, pay salaries, fund media campaigns, and buy the support of other political and armed groups. The RSF’s links to gold smuggling have also given it an ally in the UAE, where much of its money is held and from where weapons and supplies are smuggled in.

What role does the Wagner Group play in Africa’s conflict gold trade?

According to the Consumer Choice Center’s Blood Gold Report from late 2023, the Wagner Group has laundered at least $2.5 billion in African conflict gold to Russia. Wagner operates across Africa as a semi-clandestine mercenary force, running shell companies that process illicit gold and smuggle it through the UAE-centered trade network. It also serves as a protection racket, stabilizing regimes that control gold mines in exchange for a cut of the profits.

Beyond the UAE, where else does smuggled African gold flow?

India receives an estimated 200 to 300 metric tons of smuggled gold annually by air, land, and sea. Turkey has become an increasing destination as import restrictions push buyers toward illicit channels. China has become a prime endpoint for gold-smuggling chains run entirely by Chinese nationals operating in Africa, with shipments moving through networks that leave no trace in any country’s import-export data.

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