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Italy’s traditional goldsmiths are up in arms over a boom in the poorly regulated cash-for-gold sector that is making billions for the mafia as hard-up Italians rush to sell off their bling.
Cash-for-gold shops have filled Italy’s streets in recent months, with blanket tele-vision adverts urging Italians to sell off their medallions and jewels for quick cash.
Much of the gold makes its way across the Alps to Switzerland — whether legally or smuggled across the border — making gold Italy’s fastest growing export and Switzerland a more prominent market for Italy.
Custom seizures of gold are up 50%, officials say, with one of the latest cases a father and daughter arrested trying to squirrel out 50kg (110lbs) of the metal worth over €2m.
“It’s a booming sector for criminal organisations. Smuggled gold ends up all over the world, in countries where it is swapped for arms, drugs, you name it,” said Ranieri Razzante, head of AIRA, an anti-money laundering watchdog.
Legal gold sales to Switzerland totalled 120 tonnes last year — up from 73 tonnes in 2010 and 64 tonnes in 2009, with foundries built on the border having to work flat out to meet demand.
Gold workers’ guild ANOPO said “almost all the gold exported comes from cash-for-gold” raking in billions for organised crime.
“Italy’s become a veritable gold mine,” said Ivana Ciabatti, gold and silversmith president at national business association Confindustria, who is based in Arezzo, the gold production capital of Italy.
The booming over-the- counter industry is worth at least €14bn according to ANOPO, which is calling for changes to the law to stop mafia infiltration of their sector.
Thanks to a legal loop-hole, the shops can dodge Vat because they are considered part of the “scrapping” business.
Out of an estimated 28,000 cash-for-gold stores in Italy, only a few hundred have registered with the Bank of Italy.
Italy historically has some of the highest rates of gold jewellery ownership in the world because of cultural traditions like gifts of gold chains but also because ownership of gold bullion was illegal until a decade ago.
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