Washington, DC, Free and Fair Elections, the DRC, Dan Gertler, Mer, Magnitsky and Guiliani…

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Mer, Kabila, the Congo, Dan Gertler and… Rudi Guiliani… and then There’s Magnitsky

This opinion is written following a brillliant article that came out in Buzzfeed on December 30, 2020 and should be read in the context of that article entitled:

A Secretive Company Needed To Convince Washington That Congo’s Election Would Be “Free And Fair.” It Found A Friendly Ear Among Trump Allies.

A BuzzFeed News investigation, based on thousands of pages of documents and more than 100 interviews in the US, Congo, and Europe, provides a first-ever look inside Mer’s aggressive campaign to influence the Trump administration and serve Kabila’s interests. It shows how such efforts can shape foreign policy in ways unbeknownst to both the public and senior government officials, through meetings and phone calls that leave few witnesses and little trace of the private influences involved.

In this case, the most powerful nation in the world swept aside authoritarian abuses — even when many of its own top diplomats thought such a decision flew in the face of US interests.

Despite all the promises that Kabila’s proxies made in Washington that year, Congo’s election, ultimately held in December 2018, was neither free nor fair. Citing voting data that leaked after the election, international observers said that it was brazenly rigged in favor of a candidate with whom Kabila had struck a secret power-sharing deal. Kabila would officially step down, but he would still command Congo’s security forces, his allies would still hold top Cabinet positions, and his party would still wield a legislative majority.

Within days of the election, the leaked voting data sparked protests across Congo. Heads of state in Europe and Africa called for an international investigation. The US echoed the denunciation.

Mer’s efforts in Washington looked doomed.

But a month after the election, in January 2019, the Trump administration suddenly dropped its objections and instead praised “Kabila’s commitment to becoming the first president in DRC history to cede power peacefully through an electoral process.” The decision to reverse course came from Secretary of State Mike Pompeo, BuzzFeed News has learned. But it shocked veteran diplomats and rank-and-file State Department officials who had crafted the initial policy. And it put an end to the international coalition that was forming to examine the election.

Read the Buzzfeed article in its entirety here.

Let me refresh your memory, on November 7, 2019, in a follow up to an article I posted on November 6, 2019, I published an opinion piece entitled “Dan Gertler and the OFAC Sanctions – Someone Had to Have Been Negotiating with Glencore” wherein I corrected the record as to dates from the previously posted article and presented my theories. The relevant corrected dates of that article, however, only serve to substantiate my theory, that there were a series of well-timed announcements, one corresponding though seemingly unconnected to the other and all subtly buried in a haze of smoke and mirrors. Then came the pandemic and any modicum of an investigation into the activities of the relevant players fell to the wayside.

I maintain that there were lobbyists behind the scenes negotiating on Gertler’s behalf with respect to the Magnitsky Act Sanctions and corresponding payments from Glencore allegedly due to Gertler. Gertler’s proven connection to Kabila providing a backdrop. In 2019 I did not complicate matters, however, by adding in the Congo/Glencore connection because I had fully intended to fill in that piece at some future date. Suffice it to say that the sanctions were imposed upon Dan Gertler (and his related companies) by the United States for his mining activities and human rights abuses in the Congo. While both the US, for formality’s sake, and Gertler and his associates now deny the allegations of abuse that triggered the imposition of the sanctions, The Africa Report, Global Witness and Bloomberg to name a few, have made direct and undeniable connections between Gertler and those abuses. They have also directly connected Gertler to Kabila and Kabila to Gertler. While they have not necessarily tied Gertler to Kabila’s reelection, or rather re-positioning of power, the connection is largely undeniable; and we maintain the whole show was being negotiated by Guiliani and/or his associates and Mer.

In my opinion, Gertler was deeply and inextricably connected to Kabila as Kabila repositioned his power structure. The fact, as noted by Buzzfeed in the most recent publication, that Mer has connections in Washington, DC, had been hired by Kabila and has another connection to Gertler speaks volumes.  

I firmly believed in 2019 and do so now,  based upon wholly circumstantial analysis, that Rudy Giuliani along with his attorneys and his cohorts may have been the key negotiators, both on behalf of Gertler and on behalf of Kabila. Mer’s positioning in all of this is somewhat murky. With respect to Giuliani and Gertler, it is important to look at flight schedules of the Bombardier airplanes that were flying Gertler around, as well as the flight records of planes associated with Guiliani’s traipses around the world, notably to the Ukraine and Israel. I hold to the position that Giuliani and Gertler met in one or both of those locations, despite the then existence of the Magnitsky sanctions which would have largely prohibited that meeting, either directly or through an intermediary. It was a hand played quite well by Guiliani that got the sanctions lifted for enough of Gertler’s companies and assured Gertler astounding amounts of Greenbacks and likely a windfall for Giuliani. If Giuliani helped Mer facilitate Kabila’s repositioned power in the DRC, despite election results that belied that victory, Giuliani helped facilitate Gertler’s stronghold on mining operations in the DRC. Guiliani’s FARA filing along with those of some of his associates also closely align with my hypothesis.  And the fact that the FARA filing was dated early but filed late (one could argue as an administrative error – though no one will question) speaks to the time at which all of this played out.

The US acceptance of the false election results in the DRC and the announcement of the lifting of the Magnitsky sanctions were well-timed, as was the Glencore agreement for payments to Gertler.

In the 2019 articles, I analyzed the Glencore position as it applied to Gertler, the background and the loopholes in the Magnitsky Act that negotiated Gertler his windfall despite the sanctions. Simply put, the Magnitsky sanctions forbit payment in USD. The use of Euros through a joint Swiss operation made those sanctions largely irrelevant except to the extent that Glencore needed legitimacy for those payments to have been made. And, in my opinion, Ivan Glasenberg needed all of this ironed out to cede his position as CEO, which was announced this month. Suffice it say, the Magnitsky Act was poorly drafted; and it does not take savvy to find a way around its punitive intent. It only took some political maneuvering to avoid drawing attention to the details.

Once the sanctions were lifted to most of his companies entirely, Gertler was open again for free trade in Greenbacks. It also offered Gertler a chance to scrub the record clean, to create a new narrative which he did quite publicly, to make claims that he is working for the people of the DRC and to create some logistical distance between him and Kabila’s power structure.  Mer claims that it was all above board we respectfully opine to the contrary. There was an active and intentional gambit at play that I surmise Guiliani and his friends were negotiating and in exchange they all got very wealthy, including the folks at Mer.

Moreover, with the blessing of the US, which Mer claims was the “success” both Kabila and Gertler benefited financially and it was that one grand act that provided legitimacy to all that came before and all that would follow and Gertler was able to ride the tide of success.

So where does Glencore fit in? Many of Glencore’s greatest operations and financial successes stem from the very same mines owned and operated by a joint venture of sorts between Gertler and Kabila (which cannot exclude Giuliani and Mer’s involvement). In order for Glencore to clean the proverbial slate, it too needed to see the elections with Kabila blessed by the United States (or the legitimacy of continue operations in the DRC would have been questioned) and it needed the world to see Gertler through rose-colored glasses. With both things in play, Glencore could expand its DRC business into other operations and Glasenberg could either continue or retire as his own leisure and opportunity.

On December 4, 2020, Ivan Glasenberg, CEO of Glencore made a decision to retire, to be replaced by Gary Nagle. To his credt, during his tenure Glasenberg oversaw Glencore’s shift from coal to nickel, copper and cobalt and more recently to mixed asset energy, which aligns with the world-focus on renewable energy. An expansion of those resources in the DRC was a useful tool to facilitate that shift.

Glasenberg took over for Mark Rich, who founded the company, was indicted and convicted by the US attorney’s office in Manhattan along with his partner Pincus Green on 65 counts, including buying oil from Iran during the 1979 hostage crisis. Both men were ultimately pardoned by Clinton. Glasenberg positioned himself to shed the legacy of Mark Rich and to expand to become what has been referred to as the biggest commodity trader, supplying raw materials used in products from cars to smartphones. Glasenberg got extraordinarily wealthy as he did so; but that was not absent the help of Glencore’s alliance with Gertler and by implication Kabila.

Even that transition has been colorful and time will tell how it plays out. It would not be impossible to imagine a scenario whereby Glencore has agreements in place with Mer.

As quoted from the Wall Street Journal:

In more recent years, Glencore has come under fresh scrutiny from U.S. authorities. It said in July 2018 that it had received a subpoena from the U.S. Justice Department, demanding records related to its compliance with American antibribery and money-laundering laws in Congo, Nigeria and Venezuela.

Glencore has also said it is the subject of an investigation by the U.S. Commodity Futures Trading Commission. It has said it is cooperating with both probes.

Glencore said in August that it spent $56 million in the first half of 2020 defending itself from various government investigations, including those undertaken by the Justice Department, CFTC, the U.K.’s Serious Fraud Office and Brazilian authorities.

See the Wall Street Journal: Energy Trader Vitol Paying $163 Million to Settle Corruption, Manipulation Charges

To tie up the final loose end on my points, Glencore has its own auspicious history with Giuliani, independent of anything set forth in the Buzzfeed article. In 1983 Giuliani, as then US prosecutor, indicted Marc Rich for his multiple criminal activities which at the time included racketeering and embargo breaches. It is not difficult to imagine that he maintained relationships, or a well-heeled ability to affirm his understanding of the dynamics of the Gertler and Glencore relationship.

On December 3, 2020, Glencore Canada announced a subscription for Units of Travali Mining Corporation (a Toronto based company), basically providing Glencore bandwith to execute on a 2017 agreement. The 2017 agreement was negotiated for the ownership of some of the Travali mines, namely in Burkina Fasu, Nigeria and Venezuela. While Travali does not have holdings in the DRC, what made the timing of this agreement so interesting was that it was executed at about the same time as Glencore loaned Gertler money to secure two of the DRC mines as part of Gertler’s holdings. The Travali deal drew the ire of Canadian regulators who were already investigating Gertler for human rights abuses and other assorted scandals, which Gertler has denied. The deal could not effectively get actualized until Gertler was off the worldwide radar as far as human rights abuses were concerned; and until Glencore was not sharing a proverbial bed with him. All of this was made possible by the blessing of the Kabila power transition and repositioning, payments to Gertler by Glencore to effectively cut the umbilical cord and provided the context for the scrubbing of Gertler’s past record.

It does not appear that the relationship between Glencore and Kabila is under review by the Canadian authorities.    


The four-decade story of Glencore’s explosive rise and fall

Glencore’s chief Ivan Glasenberg to step down from trading firm

Serious Fraud Office investigates Glencore over suspected bribery

Glencore announces Subscription for Units of Trevali Mining Corporation

Revealed: Glencore’s secret loan to secure DRC mining rights

Editorial: Glencore in the crosshairs

What Else Does the Donald Trump–Russia Dossier Tell Us?

Glencore’s turbulent history: a timeline

Corrected typographical errors on January 4, 2021

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