TTP Investigation: Apple Inc. Buys Gold from Suppliers Connected to Illicit Activity
FOR IMMEDIATE RELEASE: September 2, 2020
Contact: Michael Clauw, mclauw@campaignforaccountability.org, 202.780.5750
WASHINGTON, D.C. – Today, Campaign for Accountability (CfA), a nonprofit watchdog group that runs the Tech Transparency Project (TTP), released a report revealing Apple Inc. relies on gold suppliers that have ties to organizations involved in money laundering, human rights abuses, and other illicit activity. Despite Apple’s reputation as a leader on environmental and human rights issues, TTP identified eight current and former gold suppliers that have ties to the Kaloti Group, a Dubai-based company that has been credibly linked to illicit activity in the gold trade.
CfA Executive Director Michelle Kuppersmith said, “Apple touts its reputation as a leader in moral business practices, but our investigation reveals that Apple relied on several shady suppliers to source the gold for its iPhones. The public should be aware that by buying an iPhone, they may be inadvertently sending money to organizations involved in money laundering and human rights violations.”
Gold is a critical part of every iPhone and other Apple products. While Apple has pledged to ensure that its gold suppliers comply with ethical sourcing standards, TTP discovered that eight of the company’s gold suppliers have ties to the Kaloti Group.
In 2014, Global Witness published a groundbreaking report revealing a series of detailed allegations against Kaloti from a whistleblower at Ernst & Young, the Big Four accounting firm that audited Kaloti’s gold supply chain. Amjad Rihan said during the audit he discovered evidence that Kaloti was buying gold from illicit sources, violating sanctions and laundering money.
Ernst & Young refused to take action and allegedly forced Rihan out of his job. Rihan filed a whistleblower lawsuit in the United Kingdom alleging his employer covered up Kaloti’s illegal activity, and in April 2020 a British court awarded him more than $10 million in damages.
In 2015, Apple commissioned a consultant to investigate ties between its suppliers and Kaloti, but did not release the results of the investigation.
Of the eight Apple gold suppliers TTP examined, three appear to have purchased gold directly from Kaloti and five more were implicated alongside Kaloti in criminal investigations of an alleged money launderer for drug cartels. Apple cut ties with only one of these eight suppliers – and that was after three of its executives were convicted of money laundering.
Ms. Kuppersmith continued, “Apple claims to investigate all public allegations brought against its suppliers, but it’s unclear what it does after those investigations. In several cases cited in our report, Apple kept doing business with suppliers credibly tied to the illicit gold trade. If Apple wishes to maintain its reputation as an ‘industry leader’ in responsible sourcing, it cannot ignore these facts.”
Campaign for Accountability is a nonpartisan, nonprofit watchdog organization that uses research, litigation, and aggressive communications to expose misconduct and malfeasance in public life and hold those who act at the expense of the public good accountable for their actions.