An investigation into the illegal trafficking of gold and mining tailings from Peru to China has exposed a sophisticated criminal network involving multiple companies, millions of dollars in illicit flows, and significant environmental damage. The investigation highlights how illegal mining is increasingly integrated into formal export channels — and how China’s demand is shaping the dynamics of this illicit economy.
Business network for the plundering of tailings
Peru’s Public Prosecutor’s Office has launched an investigation into eight companies linked to the illicit extraction, theft, and export of mining tailings to China, Ojo Público reported in February. These tailings — finely ground waste containing gold, copper, and silver mixed with chemical residues — were confirmed to contain valuable minerals and toxic substances such as cyanide by Peru’s National Superintendency of Customs and Tax Administration (SUNAT).
The investigation outlines an illegal supply chain built on forged permits and falsified certifications. Prosecutors allege that the company, Peruvian firm Intigold Mining S.A., illegally extracted tailings in Atico, Caravelí province, Arequipa region, with the support of seven other firms allegedly involved in transport, processing, and export activities within the same network. The material was transported by an estimated 30 trucks per day, while the concession holder, Consorcio Minero Horizonte S.A., reported losses of about $90 million over a nine-month period.
Between November 2023 and April 2024, the network carried out 44 shipments totaling more than 62,000 tons, declared as “gold-bearing pyrite” to conceal their origin. Although officially valued at nearly $12 million, the true scale of the operation is believed to be significantly higher.
China as a destination and structural driver
The shipments were exported to Chinese ports such as Yantai, Qinzhou, and Fangcheng, where they were acquired by companies such as Wuchan Zhongda International Group Co., Ltd., part of a Chinese state-controlled conglomerate, and Shuikoushan Nonferrous Metals Co., Ltd. between 2019 and 2025.
The case underscores a broader pattern: China remains the dominant destination for a large share of Peru’s mineral exports, making it a critical node in both legal and illicit mineral supply chains, and a key enabler of the scale and continuity of these flows. In this instance, illicit material was able to enter formal export channels, highlighting vulnerabilities in traceability, certification, and customs oversight.
These gaps allow illicit material to be laundered into legitimate trade flows, complicating detection and enforcement at both the national and international levels. These dynamics are further amplified by China’s role as a leading global buyer and processor of mineral inputs, where large trading firms — including state-linked companies — play a central role in absorbing and commercializing these materials.
Following the seizure of 120 containers at the Port of Callao on April 24, 2024, Intigold attempted to have the concession held by Consorcio Minero Horizonte S.A. declared abandoned, despite Horizonte being the legal rights holder. However, the Mining Council upheld the validity of that concession.
“It has been a landmark case for years. Intigold S.A. has long been trespassing on the property of Consorcio Minero Horizonte S.A. and does not allow the true owners to enter. All control is in the hands of armed men who guard the site 24 hours a day. The criminal proceedings have been ongoing for several years in Peru,” Peruvian security analyst Pedro Yaranga told Diálogo.
Criminal expansion and environmental damage
Illegal mining networks continue to expand their operations in regions such as Madre de Dios, Puno, Cusco, and Loreto, with growing impacts on both security and the environment.
Peruvian authorities carried out hundreds of interdiction operations in 2024, seizing and destroying assets linked to illegal mining worth hundreds of millions of dollars. Operations have continued at a sustained pace in 2025 and 2026, reflecting the scale and persistence of the threat.
Mining-related deforestation in the Peruvian Amazon reached tens of thousands of hectares in recent years, with particularly severe impacts in Madre de Dios. Socio-environmental damage in that region alone has been estimated in the hundreds of millions of dollars.
“In Peru, there are criminal gangs and organizations dedicated to mineral theft, which has led to China becoming a free market for illicit operations,” explained Yaranga.
Illicit economy with strategic implications
The expansion of illegal mining has fueled a large-scale criminal economy. Estimates indicate that illicit gold exports reached record levels in 2024, reflecting the growing profitability of the sector.
“It is an [illicit industry] that, according to the Peruvian Institute of Economics, generated around $12 billion last year [2025]. That means this illegal economy is approximately 10 times larger than that of illicit drug trafficking,” noted Retired General Rodolfo García Esquerre, High Commissioner for the Fight Against Illegal Mining.
Peru’s position as a leading global producer of minerals makes it particularly vulnerable to this form of exploitation. Criminal networks are no longer operating solely at the extraction level; they are increasingly embedded in transportation, documentation, and export processes, allowing illicit material to move through legal trade routes.
From local extraction to transnational supply chains
The case illustrates how illegal mining in Peru is evolving from a localized criminal activity into a transnational supply-chain challenge. The ability of illicit actors to insert stolen or illegally processed material into export streams — and move it toward international buyers — reflects a higher level of organization, coordination, and financial integration.
Yaranga emphasized the need to strengthen international cooperation: “In this way, through information sharing, technical assistance, and coordinated actions at the regional and international levels, we must continue to neutralize operations to weaken illicit financial flows.”
The investigation highlights not only the scale of illegal mining, but also the strategic vulnerabilities it exposes — from gaps in traceability and customs control to the role of China’s demand in sustaining illicit markets. Addressing these challenges will require a shift from isolated enforcement efforts to more coordinated approaches targeting the full supply chain — including export controls, financial tracking, and international information sharing.
