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Glencore to cooperate with U.S. corruption investigation

Kitco News

LONDON (Reuters) - Glencore Plc (GLEN.L) said on Wednesday it would cooperate with U.S. authorities after they demanded documents about the mining firm’s business in Democratic Republic of Congo, Venezuela and Nigeria as part of a corruption investigation.

The company said it had set up a committee of board members, including Chairman Tony Hayward and independent non-executive directors Leonhard Fischer and Patrice Merrin, to oversee its response to the subpoena from the Department of Justice (DoJ).

“The company will cooperate with the DoJ, while continuing to focus on our business and seeking to maximize the value we create for our diverse stakeholders in a responsible and transparent manner,” Hayward said.

“Glencore takes ethics and compliance seriously throughout the group,” the chairman said.

Switzerland-based Glencore received a subpoena from the DoJ last week requesting documents and records on compliance with the U.S. Foreign Corrupt Practices Act and money-laundering statutes.

The U.S. Foreign Corrupt Practices Act makes it a crime for companies to bribe overseas officials to win business.

The DOJ has so far not commented on the request.

Glencore shares had fallen 4.2 percent to 313.29 pence by 0921 GMT, down 20 percent since the start of 2018 and close to one-year lows. The stock suffered its biggest one-day fall in more than two years after the subpoena announcement last week.

Responding to the share fall, Glencore announced a buy back worth $1 billion in an effort to soothe investors.

Some analysts say the U.S subpoena could be a result of Glencore settling a mining row in Congo with Israeli billionaire Dan Gertler, under U.S. sanctions since last year, by agreeing to pay royalties in euros.

Congo accounts for about 25 percent of Glencore’s net present value, analysts said, adding that Venezuela and Nigeria’s contribution was negligible. The firm mines cobalt in Congo, a key metal used to make batteries for electric vehicles.

Reporting by Arathy S Nair in Bengaluru and Julia Payne in London; Editing by Patrick Graham and Edmund Blair

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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