US and UK Impose Sanctions on Global Gold-Smuggling and Money-Laundering Network
The United States and the United Kingdom have imposed sanctions on 28 individuals and entities linked to a global gold-smuggling and money-laundering network allegedly led by Kamlesh Pattni. The operation, centred in Zimbabwe, is accused of exploiting the country’s gold and diamond resources through bribery, fraudulent reporting, and a network of companies used to conceal these activities.
Pattni, a Kenyan businessman and UK citizen, became known in the 1990s for his alleged involvement in Kenya’s Goldenberg scandal. Following accusations of fraudulent gold trading, Pattni moved to Zimbabwe, where he is said to have continued developing a network facilitating the smuggling and sale of gold and diamonds, benefiting corrupt officials and depriving Zimbabwean citizens of revenues from their natural resources.
Companies and Individuals Designated
The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) identified several companies linked to Pattni. These include Dubai-based Memories Golden Jewellery LLC, Sun Multinational DMCC, Golden Luxury Jewellery Trading, Ruhmeer Diamonds DMCC, and Precious Bullion DMCC, among others. OFAC stated that these entities were used to launder proceeds and obscure ownership through associates and intermediaries.
In a statement, OFAC said: “The global network led by Kamlesh Parrni has facilitated illicit activities by bribing officials, deploying trusted supporters to mask ownership, and weaving a global web of businesses to hide the illicit activities.”
Brad Brooks-Rubin, a former special advisor to the US State Department, commented on the case, saying: “This joint action shows how complex and challenging due diligence on the gold supply chain can be—but how essential it is to get right. This is an urgent and direct reminder to jewellers and their suppliers to not just check the OFAC or UK sanctions lists periodically but to conduct proactive, integrated, and enhanced due diligence on those they are sourcing from.”
International Anti-Corruption Efforts
The sanctions, announced on International Anti-Corruption Day, form part of a broader effort by the US and UK to combat global corruption. OFAC highlighted that its actions are coordinated with the Federal Bureau of Investigation (FBI) and the UK government, demonstrating a unified approach to targeting international money laundering and smuggling networks.
Bradley T. Smith, Acting Under Secretary of the Treasury for Terrorism and Financial Intelligence, remarked: “Across the globe, when corrupt actors like Pattni choose to exploit openings in governance structures to benefit themselves and their cronies, communities suffer and public trust is undermined. Corruption respects no borders and its consequences are felt worldwide.”
Implications for the Jewellery Industry
For jewellers, this action serves as a reminder of the importance of robust due diligence in supply chains. OFAC emphasised that businesses engaging with sanctioned individuals or entities could face penalties. The jewellery industry is particularly vulnerable due to its reliance on precious materials sourced globally, making rigorous compliance protocols essential.
By adhering to sanctions lists and implementing thorough anti-money laundering measures, jewellers can minimise risks of reputational damage and regulatory violations. Proactive measures to ensure the traceability of materials not only protect businesses but also reinforce consumer trust in ethically sourced products.