Chinese buyers reported interested in Scotiabank's gold business


Scotiabank Looks to Sell Gold Trading Unit After Money-Laundering Scandal

By Henry Sanderson, Neil Hume, James Fontanella-Khan, and Gregory Meyer
Financial Times, London
Wednesday, August 18, 2017

Canada's Scotiabank has put its gold business up for sale in the aftermath of a multibillion dollar money laundering scandal centred on a U.S. refinery that involved smuggled gold from South America.

The bank's ScotiaMocatta business is one of London's main gold trading banks and is being sold by JPMorgan, according to people familiar with the process.

Chinese buyers are rumored to be the key targets of the Scotiabank sale, according to people in the market. Scotiabank declined to comment on the sale or the refinery scandal.

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The "straw that broke the camel's back" in prompting the sale, according to people in the market, was Scotiabank's lending to Elemetal, a precious metals refinery in Dallas. Scotiabank was one of their biggest lenders, they said.

In March U.S. prosecutors accused workers at a subsidiary of Elemetal, NTR Metals in Florida, of a money laundering scheme using "billions of dollars of criminally derived gold," mostly from Peru.

Elemetal did not respond to a request for comment. Scotiabank and ScotiaMocatta were not accused of any wrongdoing. ...

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