Gertler, Dark Payments from Mining, Glencore, the IMF and President Felix Tshisekedi of the DRC

The International Monetary Fund arrived for its first talks with the Democratic Republic of Congo since 2015 as President Felix Tshisekedi seeks to repair relations with the Washington-based institution and fulfill a pledge to fight corruption.

Tshisekedi, who replaced Joseph Kabila after elections in December, last month told delegates while on a visit to Washington that he’d come “to untangle the dictatorial system which was in place.” He told another meeting that Congo’s endemic corruption had “discouraged serious investors.”

“We urge them to do a thorough audit at every level and not to be lenient,” Gilbert Mundela, an adviser to Tshisekedi, said in interview Thursday in the capital, Kinsasha.

Non-government organizations want the IMF to undertake “an independent audit into the management of public companies,” according to a letter addressed to Managing Director Christine Lagarde. They also called for unpublished mining contracts to be made public.

The fund halted a $532 million three-year loan program for Congo seven years ago after the government failed to publish details of a 2011 mining deal. “Opacity in the management of public companies has only increased” since the program ended, according to the letter.

Dark Deals

The local organizations singled out state-owned mining company Gecamines, saying its transactions with international investors “are done in darkness.” Advocacy groups such as the Atlanta-based Carter Center and London-based Global Witness say Gecamines failed to account for hundreds of millions of dollars paid to it by partners in copper and cobalt deals. Gecamines rejects the claims.

The 32 organizations are also “worried” about royalties paid to Israeli businessman Dan Gertler from two copper-cobalt mines controlled by Glencore Plc. The contracts enabling Gertler to acquire the royalty streams are unpublished, according to the letter.

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Dan Gertler – Glencore, Nikanor, Fleurette, Limajo – Arm’s Length, probably not, Wholesale Ownership of DRC

Glencore Gave Loans to Businesses Linked to Suspect Congo Dealings

Documents show mining giant provided nearly $1 billion in loans and advances to aid investments by accused businessman Dan Gertler

A Glencore copper operation in the Democratic Republic of Congo.

Swiss mining giant Glencore GLNCY -0.98% PLC provided nearly $1 billion in loans and advances to companies associated with an Israeli businessman accused of having corrupt ties to government officials in the Democratic Republic of Congo, according to documents reviewed by The Wall Street Journal.

The loans, made over a roughly 10-year period starting in 2007, were designed in part to help finance investments by the businessman, Dan Gertler, in copper-mining operations in Congo alongside Glencore, the documents show.

The amount of the loans—more than previously reported—highlights the financial ties between Glencore and Mr. Gertler during their decadelong partnership in Congo. The relationship has been a focus of U.S. and Canadian authorities, who have been investigating the company’s Congo operations and ties to Mr. Gertler.

Glencore, the globe-spanning mining behemoth and trading house run by Chief Executive Ivan Glasenberg, for years has pushed back against complaints about its ties to Mr. Gertler. Mr. Gertler and his main company in Congo, Fleurette Group, have denied wrongdoing.

Analysts say mounting concerns about Glencore’s Congo operations have contributed to a decline in the Swiss company’s share price.

The details about the loans are contained in the Paradise Papers, a trove of documents from a Bermudan law firm obtained by the International Consortium of Investigative Journalists and the German newspaper Süddeutsche Zeitung, and shared with The Wall Street Journal. The papers first surfaced in late 2017.

Glencore has disclosed some of the lending to Mr. Gertler in broad strokes. A 2017 deal to buy out Mr. Gertler’s stakes in two Congo mines, for instance, folded in $556 million in debt—including $120 million in interest—that Mr. Gertler owed Glencore, the company said at the time. The cash payment in the deal was about $534 million.

The documents, though, detail a series of specific transactions in which Glencore helped to finance Mr. Gertler’s business interests in Congo. Glencore’s chief financial officer frequently signed off on documents associated with the loans.

The overall value of the loans and many of their details haven’t previously been reported.

A spokesman for Glencore declined to comment on the specifics of the loan agreements. In response to a 2014 report by London-based corruption watchdog Global Witness about Glencore’s mining deals in Congo with Mr. Gertler, Glencore said all transactions with the Israeli businessman’s companies “have been conducted on arm’s-length terms, and all public disclosure requirements applicable to us have been complied with.”

A spokesman for Fleurette Group said, “Loans made to Fleurette and its related companies were negotiated on arms-length commercial terms.” Any implication that the loans were improper is wrong, the spokesman said. “Fleurette has operated transparently and in line with all applicable laws during its interactions with Glencore,” he said, adding that all loans were used for legitimate purposes and were repaid.

Documents reviewed by the Journal show that in 2011 a company controlled by Mr. Gertler owed $300 million to a Bermuda affiliate of Glencore, Limajo International Inc., a previously undisclosed debt.

By the end of 2014, Mr. Gertler’s company owed Limajo $510 million, the documents show.

Glencore’s ties to Mr. Gertler date to the mid-2000s, when both invested in Nikanor PLC, a London-listed Congolese copper operator. In 2007, Glencore lent about $250 million to a company controlled by Mr. Gertler, and that company used the funds to purchase a stake in Nikanor, according to the documents.

Mr. Gertler later used about $61 million in Glencore funds to amass shares in another Congo mine operator, Katanga Mining Ltd. , after it merged with Nikanor, the documents show. Glencore invested in Katanga alongside Mr. Gertler and eventually came to control it.In total, Glencore provided nearly $900 million in loans and advances to Mr. Gertler’s companies, according to the documents. Some of that amount likely included accrued interest on some of the loans, the documents show.

Glencore’s Katanga Mining, in addition, made about $80 million in advances to a company controlled by Mr. Gertler from royalties he was entitled to receive, according to Katanga’s public filings. Glencore purchased Mr. Gertler’s stake in Katanga in 2017.

The U.S. Treasury Department in December 2017 sanctioned Mr. Gertler, accusing him of trading on a friendship with Congo President Joseph Kabila to amass a fortune through “opaque and corrupt” deals on behalf of multinational companies seeking to do business in Congo. Mr. Gertler has declined to comment on the specifics of the allegations.

Last month, Canada’s main stock-market regulator said Katanga Mining hid from investors the risks associated with its reliance on Mr. Gertler. The Ontario Securities Commission said Katanga, which trades in Toronto, paid associates of Mr. Gertler “to maintain relations” with the Congolese government.The

Fleurette spokesman said last month the company “has always acted appropriately and with integrity in the DRC. Nothing has ever been proven against the company or its executives in a court of law.”

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Glencore PLC, Loans to Gertler, Leveraging Companies, DRC and Kabila…

Glencore Gave Loans to Businesses Linked to Suspect Congo Dealings

Swiss mining giant Glencore GLNCY -0.60% PLC provided nearly $1 billion in loans and advances to companies associated with an Israeli businessman accused of having corrupt ties to government officials in the Democratic Republic of Congo, according to documents reviewed by The Wall Street Journal.

The loans, made over a roughly 10-year period starting in 2007, were designed in part to help finance investments by the businessman, Dan Gertler, in copper-mining operations in Congo alongside Glencore, the documents show.

The amount of the loans—more than previously reported—highlights the financial ties between Glencore and Mr. Gertler during their decadelong partnership in Congo. The relationship has been a focus of U.S. and Canadian authorities, who have been investigating the company’s Congo operations and ties to Mr. Gertler.

Glencore, the globe-spanning mining behemoth and trading house run by Chief Executive Ivan Glasenberg, for years has pushed back against complaints about its ties to Mr. Gertler. Mr. Gertler and his main company in Congo, Fleurette Group, have denied wrongdoing.

Analysts say mounting concerns about Glencore’s Congo operations have contributed to a decline in the Swiss company’s share price.

The details about the loans are contained in the Paradise Papers, a trove of documents from a Bermudan law firm obtained by the International Consortium of Investigative Journalists and the German newspaper Süddeutsche Zeitung, and shared with The Wall Street Journal. The papers first surfaced in late 2017.

Glencore has disclosed some of the lending to Mr. Gertler in broad strokes. A 2017 deal to buy out Mr. Gertler’s stakes in two Congo mines, for instance, folded in $556 million in debt—including $120 million in interest—that Mr. Gertler owed Glencore, the company said at the time. The cash payment in the deal was about $534 million.

The documents, though, detail a series of specific transactions in which Glencore helped to finance Mr. Gertler’s business interests in Congo. Glencore’s chief financial officer frequently signed off on documents associated with the loans.

The overall value of the loans and many of their details haven’t previously been reported.

A spokesman for Glencore declined to comment on the specifics of the loan agreements. In response to a 2014 report by London-based corruption watchdog Global Witness about Glencore’s mining deals in Congo with Mr. Gertler, Glencore said all transactions with the Israeli businessman’s companies “have been conducted on arm’s-length terms, and all public disclosure requirements applicable to us have been complied with.”

A spokesman for Fleurette Group said, “Loans made to Fleurette and its related companies were negotiated on arms-length commercial terms.” Any implication that the loans were improper is wrong, the spokesman said. “Fleurette has operated transparently and in line with all applicable laws during its interactions with Glencore,” he said, adding that all loans were used for legitimate purposes and were repaid.

Documents reviewed by the Journal show that in 2011 a company controlled by Mr. Gertler owed $300 million to a Bermuda affiliate of Glencore, Limajo International Inc., a previously undisclosed debt.

By the end of 2014, Mr. Gertler’s company owed Limajo $510 million, the documents show.

Glencore’s ties to Mr. Gertler date to the mid-2000s, when both invested in Nikanor PLC, a London-listed Congolese copper operator. In 2007, Glencore lent about $250 million to a company controlled by Mr. Gertler, and that company used the funds to purchase a stake in Nikanor, according to the documents.

Mr. Gertler later used about $61 million in Glencore funds to amass shares in another Congo mine operator, Katanga Mining Ltd. , after it merged with Nikanor, the documents show. Glencore invested in Katanga alongside Mr. Gertler and eventually came to control it.

In total, Glencore provided nearly $900 million in loans and advances to Mr. Gertler’s companies, according to the documents. Some of that amount likely included accrued interest on some of the loans, the documents show.

Glencore’s Katanga Mining, in addition, made about $80 million in advances to a company controlled by Mr. Gertler from royalties he was entitled to receive, according to Katanga’s public filings. Glencore purchased Mr. Gertler’s stake in Katanga in 2017.

The U.S. Treasury Department in December 2017 sanctioned Mr. Gertler, accusing him of trading on a friendship with Congo President Joseph Kabila to amass a fortune through “opaque and corrupt” deals on behalf of multinational companies seeking to do business in Congo. Mr. Gertler has declined to comment on the specifics of the allegations.

Last month, Canada’s main stock-market regulator said Katanga Mining hid from investors the risks associated with its reliance on Mr. Gertler. The Ontario Securities Commission said Katanga, which trades in Toronto, paid associates of Mr. Gertler “to maintain relations” with the Congolese government.

To read the remainder of the article click here.

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Dan Gertler – One of the 13 Most Serious Human Rights Abusers –

Israeli billionaire Dan Gertler

Israeli Diamond Billionaire Sanctioned By U.S. Anti-Corruption Law

WASHINGTON (JTA) — Dan Gertler, an Israeli with extensive investments in the Democratic Republic of the Congo, is among the first people targeted for sanctions under a new U.S. anti-international corruption law.

Dan Gertler is among “13 serious human rights abusers and corrupt actors,” the Treasury Department said in a release Thursday, who would be sanctioned under the Global Magnitsky Act passed in 2016. It is the first time the law is being applied.

Gertler “is an international businessman and billionaire who has amassed his fortune through hundreds of millions of dollars’ worth of opaque and corrupt mining and oil deals in the Democratic Republic of the Congo,” the release said. “Gertler has used his close friendship with DRC President Joseph Kabila to act as a middleman for mining asset sales in the DRC, requiring some multinational companies to go through Gertler to do business with the Congolese state.”

As a result, mining assets are consistently underpriced upon sale to Gertler or his fronts, and then resold at real value, Treasury said, with the resultant kickbacks to Gertler and Kabila costing the Congo upward of $1 billion.

Read more: https://forward.com/fast-forward/390710/israeli-diamond-billionaire-sanctioned-by-us-anti-corruption-law/

 

 

 

Read more: https://forward.com/fast-forward/390710/israeli-diamond-billionaire-sanctioned-by-us-anti-corruption-law/

Dan Gertler and Sanctions – Congo Deals

US sanctions add pressure on Israeli businessman Dan Gertler for Congo deals

A round of sanctions announced by the US targeting human rights and corruption has named Israeli businessman Dan Gertler for his “opaque and corrupt mining and oil deals” in the Democratic Republic of Congo, adding further pressure on companies that have done business with him.

The US Treasury said Mr Gertler had used his friendship with Joseph Kabila, the DRC president, to act as a middleman for sales of mining assets in the country, one of the world’s largest producers of copper and cobalt.

“Today, the United States is taking a strong stand against human rights abuse and corruption globally by shutting these bad actors out of the US financial system,” Steven Mnuchin, US treasury secretary, said. The sanctions increase the pressure on companies to cut ties with Mr Gertler or his related companies, since US citizens are prohibited from dealing with sanctioned individuals. In February mining giant Glencore announced it would pay $534m to Mr Gertler to buy him out of two copper mines in the DRC.

https://www.ft.com/content/a879743f-f80c-356d-bdb7-9ecd95fcd672