Columbia International Affairs Online: Policy Briefs

CIAO DATE: 08/2008

Metal Fingerprint: Countering Illicit Trade in Precious Metals and Gemstones

Vladimir Ivanov, Alexander Perelygin, Albert Selin

May 2008

EastWest Institute


One of the EastWest Institute's programmatic focuses is the protection of
people, economies, and infrastructure from terrorist threat. In the framework of
this program, EWI worked closely with the Russian G8 presidency in 2006 to
help organize the G8 Global Forum for Partnerships between States and
Businesses to Counter Terrorism. In line with the strategy endorsed by the
Forum, EWI launched several informal international working groups to develop
and implement specific projects involving public and private sector cooperation
to protect our societies from the evolving threat of terrorism. One strategy to
counter terrorism is to go after their sources of financing. One of the most
developed and promising initiatives to curb one source of terrorist financing-
the illicit trade of precious metals and gemstones-has been put forth by the
leading Russian mining and metallurgical company Norilsk Nickel.

A considerable portion of this trade goes on outside regulated channels,
distorting fair commerce, facilitating money laundering, and financing
terrorism. The initiative of Norilsk Nickel, one of several to come out of the
industry, is based on advanced scientific methodologies of forensic analysis of
precious metals-bearing materials. It has gained the support of the Ministry of
Foreign Affairs and the Ministry of Justice of the Russian Federation, the
International Platinum Group Metals Association, and the European Network
of Forensic Science Institutes. It has become one of the most advanced
projects in accordance with the aforementioned G8 strategy and has the
potential to become a model of efficient public-private partnership
mechanisms in fighting organized crime and terrorism.

As a contribution to efforts to curb the illicit trade of precious metals and
gemstones, EWI is pleased to present this publication. The authors,
representing Norilsk Nickel and EWI, have written this policy paper
summarizing the preliminary conclusions and recommendations discussed by
an informal international working group on countering precious metals
trafficking. The paper's intention is to help raise the awareness of
policymakers, experts, businesses, and regulating authorities about the
problem of illicit trade of precious metals and gemstones and new
opportunities for solutions in this area through enhanced international
regulatory mechanisms and professional standards.