A recent report from the Australian Financial Review indicates that the Perth Mint has connections to tax havens, thanks to its decision to hold around $100 million worth of gold for clients of a tax haven bank. This report builds on previous reports and other recent controversies regarding the Perth Mint and tax havens.
The bank in question is Euro Pacific Bank. It is in a tax haven and under investigation for potential connections to global syndicates of organized crime. According to the report, the Perth Mint let clients of this bank buy gold without undergoing the standard identity checks. Those identity verification procedures are in place to stop money laundering. The amount of gold purchased by these clients without identity checks totals $100 million.
More on the Euro Pacific Bank Investigation
The investigation into Euro Pacific Bank is known as Operation Atlantis. The J5 is conducting this international probe on taxes. The J5 was created following the Panama Papers and includes the tax chiefs of Canada, Australia, the U.K., the U.S., and the Netherlands.
The investigation is looking at around 100 Australians, as well as joint probes in other countries. Those under investigation could potentially go to jail or face other punishments for tax evasion. Australia classifies Euro Pacific Bank under the status of “Australian Priority Organisation Target.” This designation means that the bank is suspected of having a “grave” threat of organized crime to the country. This is the most serious of the Australian Criminal Intelligence Commission’s classifications.
The Report Follows Other Recent Gold-Related Controversy for the Perth Mint
This report, published in late October, does not come from nowhere. At the end of July, the Australian Financial Review published a report on the connections between the Perth Mint, tax havens, and gold.
That report criticized the Perth Mint adding the Bank of Cyprus to its list of customers. This is despite the U.S. State Department indicating the bank may be connected to organized crime in Russia and is known for money laundering. There was also criticism of the Perth Mint being an “approved dealer” to BFI Consulting, a Swiss private bank, and for Euro Pacific Bank in the British Virgin Islands. BFI Consulting, Euro Pacific Bank, and the Bank of Cyprus are all known for providing services to high-net-worth individuals who want to hide ownership of assets or avoid taxes.
The discovery that the Perth Mint is an “approved dealer” for these banks was not part of an investigation on the Mint. Still, it shows that the Perth Mint could be helpful for money launderers.
All of this was reported several months ago and was more speculative, without any exact figures. The more recent report shows the extent of the concerns related to the Perth Mint.
Other Investigations of the Perth Mint
This is far from the only investigation facing the Perth Mint. The London Bullion Market Association was investigating the Perth Mint as of July. This precious metals exchange, which is the world’s largest, is looking into Perth Mint’s interactions with Golden Valley, a PNG firm that a convicted killer owns and that has previously acknowledged toxic mercury and child labor within its supply chain. That investigation had the potential to take away the Mint’s “ethical sourcing” accreditation, a risk that had already caused some major banks to stop purchasing gold from the Mint.
The Perth Mint also conducts its own investigations. These include an independent inquiry into its PNG suppliers’ standards for social and governance. This response to the Golden Valley concerns is designed to let the Mint make improvements, such as providing tighter controls.
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