U.S. Treasury eyes Brazil drug gang ties to illegal Amazon gold mines

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FILE PHOTO: Aerial view shows a wildcat gold miner, or garimpeiro, as he uses high-pressure jets of water to dislodge rock material at a wildcat mine, also known as garimpo, at a deforested area of Amazon rainforest near Crepurizao

SAO PAULO (Reuters) - The U.S. government is concerned about links between Brazil's largest drug gang and illegal gold mining in the Amazon rainforest, a U.S. Treasury official said on Wednesday following meetings with Brazilian law enforcement and civil society.

Brian Nelson, under secretary for terrorism and financial intelligence, said he had learned alarming information about ties between the First Capital Command (PCC), a major global cocaine trafficker, and wildcat gold miners ravaging the Amazon.

U.S. President Joe Biden imposed financial sanctions in December on the PCC, which was born in the prisons of Sao Paulo in the early 1990s. Now Brazil's most powerful criminal organization, the PCC is among drug gangs helping to flood Europe with cocaine.

Nelson said his meetings in the capital Brasilia and business hub Sao Paulo had raised concerns that the PCC could also be involved in environmental crimes such as gold mining.

"We are focused on illegal gold mining ... because it can both generate resources for other illicit activities, given the value of gold, as well as providing a vehicle to launder the illicit resources from narco-trafficking," he told journalists.

Nelson said he also discussed with Brazilian officials a proposed price cap on Russian oil as part of a Western response to the invasion of Ukraine.

He did not comment on Brasilia's view of the proposal, but said "technical discussions" would continue with Brazil, a net petroleum exporter with few direct connections to the Russian energy sector.

(Reporting by Brad Haynes; editing by Richard Pullin)