April 18, 2019 / 1:31 PM / a month ago

REFILED-U.S. will not prosecute Miami gold refinery after money laundering probe

(Refiles to fix year in third paragraph to 2017 from 2018.)

By Peter Hobson

LONDON, April 18 (Reuters) - The U.S. Attorney’s Office said it has agreed not to prosecute one of the country’s biggest gold refineries, Republic Metals Corporation (RMC), after an investigation into possible money laundering.

The probe is part of a broader crackdown by U.S. authorities on imports of gold from South American countries such as Colombia and Peru that is illegally mined or used to launder drug money.

Investigators in 2017 said another U.S. refiner, Elemetal, had bought billions of dollars’ worth of illegal gold from South America. Several of its employees received jail terms.

The U.S. Attorney’s Office in the Southern District of Florida said on Wednesday it had agreed a non-prosecution deal with RMC after “an investigation focusing on money laundering and violations of the Bank Secrecy Act.”

RMC would continue to cooperate with an ongoing investigation and improve its anti-money laundering and compliance programs, it said in a statement on its website.

It did not say which actions were being investigated.

Miami-based RMC declared bankruptcy last year. Its assets are being bought by rival refiner Asahi.

No one at RMC was available to comment. Asahi declined to comment.

A U.S. Justice Department document published by a U.S. bankruptcy court this week said RMC requested the details of the investigation not be released without a court order.

The document, dated March 8, said only that the actions were “serious and worthy of investigation.”

It said RMC had handed over more than 100,000 emails and WhatsApp messages, spent more than $1 million beefing up compliance and committed to spending at least $250,000 more over the next three years.

It also said RMC had “effectively eliminated” aggregators from among its suppliers. Aggregators are companies which gather and resell metal from numerous, often small-scale, miners, making it difficult to trace the source of their gold.

“Although the Company’s compliance program had in the past failed to prohibit the on-boarding of several suppliers who ultimately proved suspicious, the Company, on its own, severed relationships with each of these suppliers before it became aware of any governmental investigations,” the Justice Department document said.

“There is no evidence that any of these relationships was initiated with an intention to violate the money laundering statutes of this or any other country.”

The Attorney’s Office said it was investigating together with the FBI, Homeland Security Investigations and the Drug Enforcement Administration.

Reporting by Peter Hobson; Editing by Bernadette Baum

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