RapNet


Rapaport News

 

Financial-Legal

 

Advanced search
Latest Articles
Videos
Features
News
Mining
Rough Markets
Polished Markets
Manufacturing
Retail

Guinea Corruption Inquiry Moves to Strip Steinmetz of Iron Concession

Report views new evidence in bribery case.
Apr 10, 2014 3:13 PM   By Global Witness
Print Print Facebook Facebook Twitter Twitter Share Share

Press Release: A government committee in Guinea today recommended stripping billionaire Beny Steinmetz of one of the world's biggest iron ore concessions on evidence that his company bribed the president's wife.

In a new report on what has been dubbed "the deal of the century," Global Witness examines the evidence on which the mining committee based its recommendation, including transcripts of FBI recordings and contracts underpinning the corruption. The key documents were published by the committee today, along with its findings on the deal.

Global Witness's report also looks at other new evidence, including a corrupt contract with one of the former president's relatives and testimony that Beny Steinmetz Group Resources (BSGR) pressured the Guinean media into hiding the involvement of the president's wife in the deal. She told the committee that a top BSGR official bribed her with cars, jewelry and a bag containing a $1 million. Criminal investigations into BSGR's Guinea deal are underway on three continents, including in the United States.

"The committee's extraordinary evidence builds on the revelations about BSGR's Simandou deal that we have been publishing since late 2012," said Daniel Balint-Kurti of Global Witness. "It is rare that the mechanics of corrupt deals are laid bare so clearly, showing how opaque mining deals can short-change the world's poorest nations."

BSGR says it "acquired its exploration and mining rights in Guinea after a fully transparent and legal process " and claimed the huge project would "contribute to increased stability and peace" in the region. It says that the evidence released by the committee was "fabricated" and that the whole process is an illegal attempt to seize its assets.

The contracts released by the mining committee show how BSGR and an affiliated offshore company promised millions of dollars in bribes to Mamadie Touré, one of then-President Lansana Conté's four wives, in exchange for help in obtaining the concessions, at a time when they were already held by one of the world's biggest miners, Rio Tinto.

The Guinean government then took the rights back from Rio Tinto in 2008 and handed them to BSGR for nothing (although the company says it later invested $160 million). BSGR booked a phenomenal profit by selling half the rights on to another major mining company, Brazil's Vale, for $2.5 billion -- equivalent to twice the Guinean national budget.

After Guinean government-appointed investigators learned of the corrupt contracts, BSGR adviser Frederic Cilins repeatedly traveled to Florida last year to meet Touré, who had moved there after the death of her husband. The transcripts of the FBI's recordings of their conversations -- linked to a wider US criminal inquiry into the Simandou deal -- show that Cilins offered Touré $1 million to destroy the corrupt contracts, claiming that he was acting under instructions from Beny Steinmetz himself.

Cilins has pleaded guilty in the U.S. to obstructing a federal investigation, for which he could be jailed for up to 47 months. He could still be charged with other offenses as the U.S. inquiry into the Simandou deal continues.

Global Witness's reports on BSGR in Guinea can be found here, including our August report that showed how BSGR was intimately connected with the British Virgin Islands company, Pentler, that signed several of the corrupt contracts.

Print Print Facebook Facebook Twitter Twitter Share Share
Tags: Global Witness
Similar Articles
GoldIndia Hikes Import Tax on Precious Metals
Jul 07, 2019
India’s Gem & Jewellery Export Promotion Council (GJEPC)has expressed...
Tariffs, Taxes Top JA Washington Agenda
India Cracks Down on Rough Shipments
Comments: (0)  Add comment Add Comment
Arrange Comments Last to First



Call Us: 1-702-893-9400
Member License Agreement   RapNet Trading Rules & Code of Conduct    Privacy Policy  
  
twitter twitter
About Rapaport
Advertise with us