LONDON: The United Arab Emirates will require all gold refineries to undergo annual audits to ensure their suppliers are responsible, it told Reuters, in an effort to combat illicit trading.
Industry figures said this should raise standards in the UAE, one of the world’s biggest bullion trade hubs, but may also shift flows of gold linked to crime or human rights abuses to other countries, for example in Africa, where the number of gold refineries is growing rapidly.
A Reuters investigation in 2019 found that UAE took in gold worth billions of dollars smuggled from Africa, some of it mined in grim and polluting conditions and countries in conflict.
Organisations including the Financial Action Task Force (FATF), an intergovernmental anti-money laundering monitor, are pressing the country nL8N2H74KY to tighten rules and enforcement. UAE has said doing so is a national priority.
UAE’s Economy Ministry told Reuters a UAE Good Delivery Standard would require refiners to properly scrutinize suppliers and prove to outside auditors they have done so.
“All gold refiners will be required to adhere to the responsible sourcing obligations,” it said. “The UAE Good Delivery Standard will also require annual compliance audits.”
The ministry said its goal was to bring the whole industry in line with responsible sourcing standards. It declined to comment further before an announcement at a precious metals industry conference in Dubai later this month.
Millions of people work in small scale gold mines that can be brutal on workers and leak toxic chemicals. The metal is often used to finance crime, conflict and terrorism.
The FATF last month placed Turkey on its “grey list potentially eroding foreign investment — due in part to “serious issues of supervision” in its gold trade.
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