A company washing its hands of dirty gold – the fool’s game must end
In November 2013, for the first time in its history, TRIAL International initiated proceedings against a company before a Swiss court. According to the criminal complaint submitted to the Office of the Attorney General (OAG), Argor-Heraeus SA, a company based in Ticino, may have refined almost three tons of gold mined in the Democratic Republic of the Congo (DRC) between 2004 and 2005. The gold had allegedly been pillaged by a rebel group.
During the year and a half that followed, the OAG conducted an investigation into war crimes and aggravated money laundering, resulting in the refinery company’s headquarters in Mendrisio (Ticino) being searched. The case sparked a civil society campaign against pillaging precious metals in times of armed conflict.
On March 10, 2015, the Argor case was closed. The OAG concluded that there was insufficient evidence that the company had been aware of the gold’s criminal origin. Strikingly, the federal prosecutor did recognize that the gold had indeed been pillaged in DRC by the Nationalist and Integrationist Front militia (Front nationaliste intégrationniste).
How could the company have slipped through the net? People and companies that are accused of illegal actions often justify them by claiming that they were unaware of the context in which they were conducting their activities, or of the people with whom they were doing business. Swiss law, in its present state, does not require due diligence. Companies are not legally obliged to investigate who they do business with, or where any purchased goods come from.
“Without a duty of due diligence, it is impossible to demonstrate intent, which is key to constitute pillage”, explains Philip Grant, TRIAL International’s Executive Director. “Switzerland must adopt a regulation that requires companies to know where their goods come from, as is the case of many banks that comply with ‘know-your-customer’ guidelines. Imposing a duty of due diligence means preventing that such shortcomings reoccur and prohibiting companies at fault from shirking their responsibilities.”
Recently, other Swiss companies active in the gold trade have made the headlines, including another refinery from Ticino that does business with a Dubai-based wholesaler with dubious links to militia in Darfur. Without standardized regulations, there is little doubt that such situations will occur time and again in the future.