News, analysis and personal reflections on the markets & the financial sector

Monday, January 17, 2011

Colombia Shuts Two Illegal Gold Mines in Crackdown

(Bloomberg) -- Colombia shuttered two illegal gold mines, seized equipment and arrested 15 people as the government intensifies efforts to crack down on sources of funding for guerrilla groups.

The closures in the province of Tolima in central Colombia bring to 56 the number of mines sealed since September to derail financing for “illegal groups,” the government said today in a statement on the presidential website.

President Juan Manuel Santos said computers seized after a military strike last year on the Revolutionary Armed Forces of Colombia, known as FARC, shows illegal gold mining helps finance the group. The government found an e-mail about illegal mining on a laptop that belonged to Mono Jojoy, the rebel military chief killed in a September military raid, Santos said Jan. 15.

Police are tracking down the destination for revenue from the illegal mines in the municipality of Mariquita in Tolima, where extraction of ore polluted a river with mercury, the government said. Mines being closed operate without government consent or oversight.

Santos pledged when taking office in August to maintain military pressure to weaken guerrilla groups. Improved security has attracted international investment in gold, coal and oil production, boosting commodities exports. Foreign direct investment in mining rose to $3 billion in 2009, the last year of annual figures available, from $1.8 billion in 2008, according to central bank figures.

As a former defense minister, Santos oversaw the rescue of 15 rebel-held hostages, including French-Colombian politician Ingrid Betancourt, and an air strike into Ecuador that killed Raul Reyes, another top rebel commander.

The FARC, considered a terrorist group by the U.S. and the European Union, was founded in 1964 by Manuel Marulanda, who died in 2008 of a heart attack.

No comments: