February 5, 2020 / 5:35 PM / 11 days ago

Court convicts Belgian gold refinery Tony Goetz of money laundering

BRUSSELS/LONDON (Reuters) - Two brothers from a Belgian gold refinery have been found guilty by a court in Antwerp of money laundering and fraud and given 18-month suspended jail sentences, a court ruling showed.

FILE PHOTO: Alain Goetz, CEO of AGR (African Gold Refinery) speaks during an interview with Reuters at a refinery in Entebbe, Uganda, October 4, 2018. REUTERS/Baz Ratner/File Photo

The judgment comes as investigators and states increase pressure on refineries to make sure illegally mined or traded gold does not enter the market.

It also increases the focus on Alain Goetz, one of the brothers sentenced, who established a refinery in Uganda that officials there say they are investigating for accepting gold from Venezuela that may have been smuggled. The refinery denies wrongdoing.

The court ruling said Alain and Sylvain Goetz set up a fraudulent system in 2010 and 2011 for customers to sell gold anonymously to the Tony Goetz refinery in Antwerp for cash, creating the basis for black-market trade.

    The refinery registered gold traders as private customers and split large purchases to circumvent limits on cash transactions, and accepted metal taken by armed robbers in the Antwerp gold quarter, it said.

    Tony Goetz paid more than 1 billion euros ($1.1 billion) in cash for gold during 2010 and 2011 and created around 9.2 million euros in illegal capital gains, the ruling, issued on Jan. 30, said.

    The court fined the refinery 99,000 euros.

Both the jail terms and the fine were suspended, meaning they will not take effect unless the refinery or brothers re-offend.

Sylvain Goetz runs the refinery and is the eldest son of its founder.

    “Tony Goetz contests these facts and upholds that the company did not violate any law,” the refinery said in a statement, adding that it was considering whether to appeal.

    Tony Goetz “does not cooperate in any way in the illegal trade of gold or other precious metals and conducts its activities in accordance with all applicable rules and regulations,” it said, adding that since 2012 it has not accepted any cash payments.

It also said Alain Goetz was no longer connected with the company and it does not accept gold from Venezuela or Uganda.

    Alain Goetz said he had resigned as a director and sold his shares around 2014. He also said he had stepped down from management and sold his shares in the Ugandan refinery.

    Alain Goetz said the ruling was “erroneous” and paying for gold in cash was common and legal during 2010 and 2011.

    “Neither Alain Goetz nor Tony Goetz NV breached any anti-money laundering regulations or other legislation in force at that time,” he said in a statement to Reuters.

    Around 25 customers of Tony Goetz were also found guilty by the court for participation in the system, with some given suspended jail sentences of up to nine months.

Reporting by Marine Strauss, Peter Hobson and David Lewis; Editing by Veronica Brown and David Evans

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