Editor’s Note
This article examines a police investigation into an Italian refinery accused of sourcing gold from an alleged illegal trader in the Amazon. Corporate disclosures link this gold to major technology firms, raising questions about supply chain transparency and environmental responsibility in the global electronics industry.
The Brazilian police have accused an Italian refinery of purchasing gold from a trader who allegedly sourced it illegally from the Amazon rainforest region. Corporate disclosures indicate that the refinery supplied the precious metal to four of the world’s largest technology companies. Public documents from Amazon, Apple, Microsoft, and Alphabet (Google) name the Italian private company Chimet as a source of gold used in their products. Technology companies frequently use small amounts of the metal in circuit boards for consumer electronics.
According to police documents obtained by the investigative journalism team Reporter Brasil and reviewed by Reuters, the Brazilian Federal Police (Polícia Federal) accuses Chimet of purchasing millions of dollars worth of gold from the trader CHM do Brasil, which allegedly acquired the precious metal illegally from illegal miners. CHM do Brasil, responding to questions via a lawyer, stated that all its gold was acquired legally with proper documentation.
Since the inauguration of right-wing President Jair Messias Bolsonaro in 2019, illegal mining in Brazil has increased, as he seeks to legalize mining on indigenous lands. Unregulated mines have destroyed the Amazon rainforest and polluted rivers with deadly mercury. Miners have clashed violently with indigenous tribes protecting their land, leaving a trail of death, disease, and intimidation. The Brazilian sustainability think tank Instituto Escolhas estimates that the country produced eighty-four tons of illegal gold in Bolsonaro’s first two years in office, a twenty-three percent increase from the previous two years, equivalent to almost half of Brazil’s total gold production.
According to a Chimet representative, the company severed ties with CHM when it learned of the allegations in October 2021. At that time, police conducted raids in nine Brazilian states and the federal district against CHM and others allegedly involved in the illegal gold trade. A police document from August 2021 summarizing the investigation states that Chimet allegedly purchased 2.1 billion reais ($385 million) worth of gold from CHM between 2015 and 2020. A spokesperson for the Federal Police in the state of Pará declined to comment on the investigation as it is ongoing and sealed. Charges would likely be announced once the investigation is completed later this year. Federal prosecutors would then decide whether to file charges.
The four US technology companies listed Chimet among over one hundred gold refineries in their supply chains during the five-year period under investigation and in recent 2021 disclosures. Chimet does not maintain direct relationships with the four large companies but sells gold to banks, which can resell it for various purposes, the company’s representative Giovanni Prelazzi told Reuters. He did not name the banks.
Amazon, Alphabet, and Microsoft declined to comment. Chimet stated that after learning of the CHM investigation in Brazil, it commissioned the auditing firm Deloitte to conduct an audit of its other suppliers and was recertified in April 2022 by the gold market association LBMA for compliance with responsible gold sourcing standards.
The police documents claim that CHM was not registered with the Brazilian Central Bank as a legally authorized company for buying and selling gold, known as a DTVM. CHM is consequently not listed in the Central Bank’s online directory of registered DTVMs. Without such registration, buying and selling gold in Brazil is illegal for anyone other than miners and their associations. CHM stated that it does not buy gold as a financial instrument and that no registration is required for purchasing gold as a commodity. The Central Bank stated that it does not regulate “transactions with gold classified as a commodity.” An analysis of relevant laws by federal prosecutors in 2020 concluded that such registration is required for any non-miner to buy and sell gold, regardless of its use. Financial records of bank transfers show that CHM purchased gold both from the cooperative and directly from several individuals in the southern part of the state of Pará, which belongs to the Brazilian Amazon region.