Two New Yorkers Found with 61 Gold Bars at Brazilian Airport Show Complexity of Illegal Gold Trade

An American duo was recently caught trying to smuggle dozens of gold bars out of a city on the edge of the Amazonian rainforest. Brazilian authorities have stepped up efforts to curtail Illegal gold mining in the Amazon because the illegal mining activities have increasingly caused humanitarian disasters.

The Amazon rainforest is currently host to thousands of illegal gold miners, which has significantly increased gun violence in the region and pushed away local game, resulting in starvation among indigenous communities that live within the forest. In addition, experts estimate that illegal gold from the Amazon equals one-half of Brazil’s total legal gold exports.

The two U.S. businessmen were looking to take advantage of rising gold prices and hatched a plan to find gold in Brazil and offload it to sellers at a profit. Frank Giannuzzi, who was 62 years old at the time, had worked as a Wall Street trader for decades, while then 39-year-old Steven Bellino was an equity trader who had launched several businesses.

Once the idea was planted solidly in their minds, Giannuzzi took advantage of his Brazilian wife’s connection to meet with a local gold seller in Sao Paolo and New York. A few months after these meetings, Giannuzzi, Bellino and their Brazilian partner were walking through the Manaus airport with 61 gold bars stuffed into four canvas bags.

However, their plan to fly to New York was foiled when a team of local federal police officers stopped them and searched their bags. They found 61 gold bars worth $1.4 million, an official police report says. Furthermore, a device used to check the composition of precious metals revealed that the gold bars’ purity levels indicated they were mined.

Brubeyk Garcia Nascimento, the duo’s Brazilian contact, was arrested on illicit gold trafficking charges, while Giannuzzi and Bellino were released after questioning with no charges. The duo told Brazilian authorities they had no reason to believe the gold was illicit.

A three-year-long intercontinental legal fight ensued after the incident. It even dragged in the name of Austrian businessman Werner Rydl who had already been accused of smuggling gold in Brazil. According to experts, the fact that the two Americans could easily acquire questionable gold underscores the difficulty of effectively tackling illegal gold mining and smuggling in Brazil.

Illegal mining has been on the rise in recent years amid increasing gold demand, and drug cartels use a lot of this illicit gold to run illegal businesses and launder dirty money. These illicit mines have also been tied to climate change risks as miners often cut down large sections of carbon-storing forests.

In contrast, licensed mining companies such as Royal Gold Inc. (NASDAQ: RGLD) take the utmost care to minimize any adverse effects upon the environment or surrounding communities arising from their mining activities.

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