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The Financial Intelligence Unit (FIU) of Zimbabwe has called for greater capacitation of the Ministry of Mines and Mining Development to help curb rampant gold smuggling and strengthen enforcement of Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) rules, Mining Zimbabwe can report.
By Ryan Chigoche
This follows findings from the FIU’s 2024 National Money Laundering Risk Assessment: Summary of Findings, which rated money laundering risks in the precious metals and stones sector as “medium-high,” with both threat and vulnerability levels assessed similarly.
The report revealed that gold smuggling remained high between 2019 and 2023, exposing the sector to funds from illicit sources, while awareness of AML/CFT obligations among sector players was found to be relatively low.
Zimbabwe faces significant challenges with mineral smuggling, particularly involving gold and lithium, which drain substantial state revenue. Gold smuggling alone is estimated to cost the country at least US$200 million annually, driven by organized syndicates and weak enforcement.
The FIU has highlighted the mining sector’s low AML/CFT awareness, prompting recommendations to capacitate the Ministry of Mines, strengthen controls, tighten border security, and enhance collaborative enforcement to curb illicit mineral trade and protect national resources.
With smuggling rife and the ministry struggling to enforce regulations, the FIU in its recommendations laid out clear steps for Zimbabwe to tighten oversight and plug the leaks in the mining sector:
“We recommend capacitating the Ministry of Mines and Mining Development, as the licensing authority for gold dealers, to enable it to effectively carry out its AML/CFT supervisory responsibilities. Controls should be strengthened to prevent gold leakages in the sector, and gold should be traded only through licensed and regulated dealers. We further recommend tightening controls at ports of entry, exit, and along border lines, and enhancing enforcement of sanctions for AML/CFT breaches through close collaboration between the FIU, the Ministry of Mines, and the ZRP Criminal Investigations Department (CID) Minerals Flora and Fauna Unit (MFFU),” the FIU said.
However, the ministry’s ability to act on these recommendations could be hampered by limited resources.
For the 2025 fiscal year, it was allocated approximately ZWL664.8 million (about US$22.16 million), representing just 0.3% of the national budget.
This modest allocation restricts essential activities such as inspections, audits, and the development of critical infrastructure, including metallurgical laboratories, limiting the ministry’s effectiveness in regulating the sector and curbing mineral smuggling.
In a rapidly evolving global financial landscape, combating money laundering and terrorist financing remains a critical priority.
“The assessment provides a comprehensive evaluation of the money laundering threats facing the country as well as identifying the vulnerabilities in the AML/CFT system that can be exploited by criminals to launder ill-gotten wealth. The results of the assessment will inform the crafting and adoption of the country’s AML/CFT Strategy for 2025–2029 on the policies and measures needed to mitigate the identified risks,” commented FIU Director General, Oliver Chiperesa.
This is Zimbabwe’s third NRA, following previous assessments conducted in 2014–2015 and 2019–2020. The FIU noted that the 2024 assessment demonstrates the country’s continued alignment with international standards and its commitment to safeguarding the financial system.
