When we think of gold smuggling we often think back to age-old tales of pirates or train robbers. It’s a crime that we only really know of through fairy tales we read as children, and yet this age-old crime is making new waves over in Japan.
According to a report printed in the New York Times, gold smuggling is becoming increasingly more problematic in Japan where aging gangsters and amateurs, including a middle-aged female crime ring allegedly headed by a 66-year-old woman, are stepping out of the traditional trades of drug sales and prostitution and exchanging them for a safer means of securing illegal funds.
Experts say that it should come to no surprise that the crime is appealing, especially in Japan. While Japan has some of the lowest crime rates in the world, crimes such as shoplifting and embezzlement still remain relatively high compared to violent crimes. The crime rings involved in gold smuggling do not have to carry any weapons, they simply have to conceal the gold inside their clothing in order to dodge taxes. Once the gold is in the country it can then be pawned to brokers who will pay the market price, plus the eight percent consumption tax that is required to import the metal. The profits from only a single trip can net the smuggler millions of dollars in return.
News on Japan reports that in June of 2017 gold smuggling incidents have hit a record high in the country over the past 12-month period. This increase began in 2014 after Japan raised the consumption tax on gold from five percent to eight percent.
In one high-profile incident, The Japanese Coast Guard arrested five Japanese men and three Chinese men after stopping a fishing boat the men had packed full of gold bullion. If the men had been successful in their operation, the 206 kilograms of gold found on the fishing vessel would have netted the group an estimated $9.1m at today’s market value.
The most recent arrest involved a group of 10 Japanese men and women who plotted to smuggle 33 kilograms of gold, worth over a million dollars, into the country from South Korea. The group was busted by customs after they landed at the Narita Airport and have since been charged with violating the Customs Act and the Consumption Tax Act.
Most of the smuggling begins in South Korea or Hong Kong where individuals are not required to pay a consumption tax on gold. From there, mules are paid to carry out orders from various crime syndicates including groups with connections to the Yakuza. Everyone makes a profit, no one is risking their life, and the only real victims are the customs agencies delegated with collecting the taxes. The crime is so appealing that many see it as a part time job and feel no moral dilemma in what they are doing. With such little risk in this relatively victimless crime, it should come to no surprise that gold smuggling is making a comeback.