Quora Answer: Why is Money Laundering Not Done with Precious Metals so That It Would be Untraceable?

The following is my answer to a Quora question: “Why is money laundering not done with precious metals so that it would be untraceable?” 

The purpose of money laundering is to place funds that have been illegally earned, either through criminal endeavour, or to evade taxes, into the system, by concealing its origins.  Precious metals are difficult to place back into the system.  The people who trade in precious metals are known to each other.  The pool of people to be traced is not a large one.  Gold laundering is a process in itself.  Unless money laundered is from the sale of illegally obtained gold, it makes no sense for someone not involved in this trade to use previous metals. 

Precious metals, especially gold, is far from untraceable.  Processed gold is tagged, and there are serial numbers and various forms of registration and documentation.  Gold ore can be traced through the minute impurities in the ore, which is like a fingerprint, and can tell us the specific region it was mined from. 

One of the considerations of money laundering is easy placement of funds into the system.  Cash and cash equivalents are the easiest to conceal due to the volume of transactions involving them.  There is no such volume of transactions for precious metals.  Large fund movements are seldom physical, but through electronic means.  That can be done with cash placed in accounts through smurfing.  This is not an option for precious metals.