Glencore to cooperate with U.S. corruption investigation

FILE PHOTO: The logo of commodities trader Glencore is pictured in front of the company's headquarters in Baar, Switzerland, July 18, 2017. REUTERS/Arnd Wiegmann/File Photo

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.

  • FILE PHOTO: The logo of commodities trader Glencore is pictured in front of the company’s headquarters in Baar, Switzerland, July 18, 2017. REUTERS/Arnd Wiegmann/File Photo
  • 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.

    After the announcement, the company’s shares suffered their largest one-day fall in more than two years. The shares are now down 20 percent since the start of the year and near one-year lows. At 0804 GMT, the shares were at 314.35 pence.

    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.

    Source: Read Full Article