Glencore may face UK probe over DRC deals
Publish date: 21 May 2018
Issue Number: 774
Diary: IBA Legalbrief Africa
Category: Mining
Glencore may face a British fraud probe into alleged corruption in the DRC. Legalbrief reports that the mining company is based in Switzerland and listed on the London stock market and the claims have sent its share price tumbling. The UK’s Serious Fraud Office (SFO) is expected to launch a formal bribery investigation into Glencore that will focus on its dealings with Israeli billionaire Dan Gertler and DRC President Joseph Kabila. Mining Weekly reports that two sources with knowledge of the matter noted that the prosecutor would have to show it has jurisdiction because the company’s shares are traded in London. Any final decision on whether to proceed with a formal probe will be up to a committee of SFO senior staff, including interim director, Mark Thompson.
Biz News reports that the US Government has also accused Gertler of corrupt mining and oil deals in the vast country and claims he acted as a middle-man to enrich Kabila. The two have been close since Gertler arrived as a young diamond merchant during a civil war in 1997, and Congo – one of Africa’s poorest countries – is the main source of his wealth. In 2016, US court documents alleged Gertler channelled more than $100m in bribes to Congolese officials on behalf of New York hedge fund Och-Ziff Capital Management LP, which paid $413m to settle federal charges. Gertler was never charged. BBC News reports that the US Office of Foreign Assets Control imposed sanctions on the billionaire in December, saying he had deprived the DRC’s coffers of funds. ‘Mr Gertler has used his close friendship with DRC President Joseph Kabila to act as a middle man for mining asset sales in the DRC, requiring some multinational companies to go through Gertler to do business with the Congolese state,’ the ruling said. Gertler denies paying bribes and insists his success reflects a long-standing friendship with Kabila and a track record for delivering results. DRC Government spokesperson Lambert Mende said Kinshasa is ‘absolutely calm’ about the matter. ‘We are ready to take all the blows and we are ready to fight back,’ he said.
