Former United States Federal Bureau of Investigation (FBI) investigator Karen Greenaway, who now works as an anti-money laundering consultant, told Al Jazeera, ‘They have set themselves up to be in the middle of the gold trade, with lax laws and no enforcement.’ That’s what draws the gold mafia to Dubai.
Over the last 20 years, Dubai has become one of the biggest gold-trading hubs in the world. The United Arab Emirates (UAE) is the world’s second-biggest importer of gold by volume, behind only India.
Yet, while Dubai’s markets draw millions of tourists from around the world, the city has also emerged as a preferred destination for money launderers and gold smugglers trying to wash their dirty cash, according to the United Nations (PDF), think tanks and non-profits tracking illicit trade.
Gold Mafia – a four-part Al Jazeera investigation into major Southern African smuggling gangs – uncovers the process that allows these groups to abuse Dubai policies, designed to facilitate business, to instead cleanse billions of dollars of tainted gold and cash.
“It all comes out of Dubai. Dubai, Dubai, Dubai,” Zimbabwean gold smuggler Ewan Macmillan told undercover reporters from Al Jazeera’s Investigative Unit (I-Unit).
‘They don’t bother’
For years, Dubai has ranked near, or at the top of, cities globally that attract the most foreign direct investment. It is also a popular commodities trading hub. That reputation has been built on the back of a series of policies to attract businesses.
Dubai’s so-called free zones – trade areas specifically established for foreign investors to easily set up their companies – are at the heart of this strategy, with no taxes and duties, negligible bureaucratic red tape and norms that allow quick repatriation of profits.
But critics say those same policies also enable large financial crimes to slip through the cracks.
“Dubai was set up to be a financial capital,” former United States Federal Bureau of Investigation (FBI) investigator Karen Greenaway, who now works as an anti-money laundering consultant, told Al Jazeera. “They have set themselves up to be in the middle of the gold trade, with lax laws and no enforcement.”
“All of those things make Dubai a great place to have something like this, a major international money laundering operation involving, in this case, gold smuggling,” she said, referring to the Al Jazeera investigation.
The absence of “policing” of the free zones allows them to be abused, Greenaway said.
The Mumbai airport has been identified as the largest hub of gold smuggling in India by the customs department. This revelation was made after the seizure of 604kg of smuggled gold worth Rs 360 crore at the Mumbai international airport within a period of 11 months.
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