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/

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Trouble in Paradise Dan Gertler, Glencore, the DRC and Secret Loans

Israeli billionaire Dan Gertler

Dear Reader:

The Paradise Papers have brought us a wealth of information on some of our most reprehensible of “philanthropic” figures, not the least of which is Dan Gertler. As an ode to Dan, we decided that we would publish his story as the first of the Paradise Papers publications.

It is an remains our position that Gertler  pilfered (raped was the word we initially wanted to use) an entire country out of mining rights to the detriment of the citizens of that country. It is and remains our position that his dealings with high-powered players in the Congo lead to the death of one such player (Katumba) and to the slaughter of people in the region.  

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

https://www.theguardian.com/business/2017/nov/05/revealed-glencore-secret-loan-drc-mining-rights-paradise-papers

The world’s largest mining company, Glencore, secretly loaned tens of millions of dollars to an Israeli billionaire after it enlisted him to secure a controversial mining agreement in the Democratic Republic of the Congo, the Paradise Papers reveal.

The documents show in forensic detail how the mining magnate Dan Gertler held Glencore’s imprimatur as key negotiator with DRC authorities.

The Paradise Papers, a leaked cache of documents including more than 6m from within Appleby, one of the world’s leading and most secretive offshore law firms, lay bare the arcane multi-jurisdictional dealings of Glencore, a scandal-plagued Swiss multinational with mining interests across the globe, but particularly in Africa.

The documents confirm that in 2009, Glencore loaned Gertler $45m with the caveat that it would be repayable if agreement with DRC authorities was not reached to secure a mining contract for a company linked to Glencore.

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He is also alleged to be the unnamed “DRC Partner” cited in a 2016 US Department of Justice deferred prosecution agreement who, along with others, paid more than $100m in bribes over a decade to DRC government officials “to obtain special access to and preferential prices for opportunities” in the country’s mining sector for a US hedge fund.

 

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The Paradise Papers confirm that several times over 2008 and 2009, Gertler was called in to negotiate with DRC authorities over the struggling Katanga copper mine in the south-east of the country, which was mired in stalled talks to secure a joint-venture agreement with DRC’s state-run miner Gécamines.

In 2009, Glencore, through a loan offer, took effective control of Katanga, but also kept Gertler’s interest in the company by secretly loaning his company Lora Enterprises $45m in pledged shares for him to take part in the loan. Gertler, known for his close relationship with DRC’s president and key adviser, was also tasked with securing the mining agreement.

“Glencore shall use its vote at the board of Katanga to have Dan Gertler exclusively mandated to assist Katanga in finalising the terms of the joint venture agreement,” the finance document shows.

But the Paradise Papers also reveal that the terms of the loan meant it could be recalled if the mining agreement was not secured. The term sheet states that it will be “immediately repayable on demand” if the agreement “is not finalised within three months”.

 

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Glencore, and its forerunner company, have been accused of sanctions-busting in Saddam Hussein’s Iraq, apartheid South Africa and Iran. In 2004, Glencore was cited by the CIA as having paid $3.2m in illegal kickbacks in violation of sanctions to Iraq’s state-run oil monopoly. It has also been accused of environmental pollution, poisoning rivers, and allowing child labour in its African mines. Glencore denies the allegations.

In February, Glencore bought Gertler out of their shared assets in DRC for $534m, a move described by analysts as an attempt by the company to disassociate itself from Gertler.

DRC is ranked by the UN as one of the least developed countries and has been blighted by near-constant civil war for decades. The massive landmass, as large as western Europe, is rich in mineral resources, making it a target for foreign powers and heavily armed rebel groups seeking to control lucrative assets.

The country remains mired in turmoil. Kabila, who took over the role from his father, Laurent-Désiré Kabila, in 2001 after he was assassinated by his bodyguards, refused to hold constitutionally mandated elections last year.

Katanga Mutanda; Mining and Dan Gertler, Glencore Canada Probe

Glencore Payments Face Canada Probe — WSJ

LONDON — Glencore PLC is under investigation by Canadian regulators looking into more than $100 million in payments a subsidiary made to a company owned by an Israeli businessman who has been accused of bribing Democratic Republic of the Congo officials, said people familiar with the investigation.

The investigation stems from payments that a Canada-based copper-mining company controlled by Glencore and that operates in Congo was expected to make to Congo’s state-run mining company, Gecamines, but instead sent to a Caymans Island company owned by the Israeli businessman, Dan Gertler. Glencore has acknowledged the shift in payments and said it was done at the request of Gecamines.

Canada’s Ontario Securities Commission, the country’s biggest regional securities regulator, is investigating whether the Glencore subsidiary, Katanga Mining, violated rules requiring that companies disclose business done with their own investors, said the people familiar with the investigation. Katanga is listed in Toronto and Mr. Gertler’s company has invested in its business.

Glencore and Gecamines declined to comment. A spokesman for Mr. Gertler’s company said it disputed any allegations of bribery and follows all disclosure obligations.

A spokeswoman for the Ontario Securities Commission said the agency had a policy against commenting on the “existence, nature or status of any investigation.” Investigations by securities agencies don’t necessarily result in regulatory action.

The payments began in 2013, according to Global Witness, a nonprofit investigative group that works to publicize allegations of resources-industry corruption and brought the payments to light.

Both Gecamines and Mr. Gertler’s company, Fleurette Group, have for years been large investors in Katanga Mining’s business, according to Canadian public records. That could make them so-called related parties to Katanga, meaning that each has a significant stake in the company and therefore is potentially subject to disclosure requirements under Canada’s law, said experts on Canadian securities regulations.

Katanga had disclosed payments to Gecamines, which it described as a related party, in regulatory filings until 2014. Starting that year, Katanga disclosed no further payments to Gecamines, nor did it report the payments to Mr. Gertler’s company, according to a review of its filings by The Wall Street Journal.

Under a deal with the Congolese government, Gecamines is allocated a slice of annual sales from Katanga Mining subsidiary Kamoto Copper Co., known as KCC. But rather than send the royalties to Gecamines, KCC has been sending them to Mr. Gertler’s Cayman Islands-based company, Africa Horizons Investment Ltd., Glencore and Fleurette have said.

Glencore and Fleurette have said Gecamines wanted the money shifted to Mr. Gertler’s company to pay back a $196 million loan Fleurette made to Gecamines in 2013. The payments are ongoing, they said.

Glencore is the world’s third largest copper producer behind Chile’s state-owned copper mining company, Codelco, and Freeport-McMoRan Inc., according to CRU Group, a commodity research firm. Katanga ranks among Glencore’s largest copper operations, though work there has been suspended for the past 18 months as the company undertakes a $1 billion upgrade.

The probe represents a new risk posed by Glencore’s longtime relationship with Mr. Gertler, from whom the company has sought to distance itself in recent months.

Mr. Gertler was a central figure in a $412 million settlement in September between the U.S. Justice Department and the Securities and Exchange Commission with New York hedge fund Och-Ziff Capital Management Group LLC. The Justice Department alleged in a criminal case that Och-Ziff, in pursuit of investment profit, went into business with Mr. Gertler despite a consultant’s warnings that he used political connections in Congo to benefit himself and his associates.

The Justice Department said Mr. Gertler paid more than $100 million in bribes to Congolese officials, including President Joseph Kabila, in exchange for access to some of the nation’s best mineral assets. Mr. Gertler hasn’t been charged.

“We dispute any allegation of bribery” in Congo, a Fleurette spokesman said.

Congolese government officials haven’t responded to requests for comment about the allegations.

Daniel Och, chairman and chief executive of Och-Ziff, has said the firm’s conduct scrutinized by the Justice Department was “inconsistent with our core values.”

In response to the Justice Department findings, a Glencore spokesman said that the firm “takes ethics and compliance very seriously and is considering this information.”

Glencore and Mr. Gertler joined forces in Congo in 2007 when Glencore invested in a Congo-focused mining company called Nikanor PLC, partly owned by the Israeli businessman. Nikanor merged with Katanga a year later, forming one of Congo’s largest copper-mining operations.

Glencore in February purchased Mr. Gertler’s stake in Katanga Mining, as well has his stake in another jointly run Congo copper mine, Mutanda Mining, for nearly $1 billion, a move analysts said helped distance the company from Mr. Gertler.

The buyout, as well as rising copper and cobalt prices, have turbocharged Katanga Mining’s stock, which has surged nearly 500% in the past 12 months, according to FactSet.

Dan Gertler, the Systematic Destruction of Obstacles and the Lawyers Involved – The Gertner Brothers – PART I

THE SYSTEMATIC DESTRUCTION OF MOISES GERTNER AND HIS BROTHER BY DAN GERTLER, HIS LAW FIRMS, HIS PR FIRMS HIS RELATIONSHIPS AND A SERIES OF COMPANIES, TRUSTS AND PARTNERS

LostMessiah – 23 June 2017

Earlier this week we published an article regarding Dan Gertler which made reference to a series of other articles, including to a blog post of paramount importance entitled: “Exposing African Mafia and Corruption” in a Blogspot – Purifying Africa. Interestingly the information published by Purifying Africa, though a series of what appears to be leaked emails from a law firm, seems to have been largely ignored by mainstream media. We believe it speaks volumes to the extent to which the Gertler empire will go to destroy its perceived adversaries.

The emails include correspondence written by an attorney by the name of Dory (Avigdor) Klagsbald of a law firm in Israel. The parties who are cc’d or otherwise mentioned in those emails include attorneys with Mishcon de Reya LLP, a series of consulting firms (namely public relations firms), and attorneys from Millbank, Tweed, another law firm. 

The sole purpose of those emails appear to be outlining a strategy to unwind an individual voluntary arrangement (IVA) which was a negotiated agreement between Islandic Bank Haupthing and the Gertner brothers for repayment of a loan at what was to have been an undisclosed amount. That effort continues and has all but destroyed Moises Gertner.

It should be noted that much of the alleged payments of that loan and corresponding guarantees are in the form of interest and fees. We believe the current claims by CFL are tantamount to extortionery at this juncture, particularly since these events have dragged on for years and there were agreements in place to settle many of those loans. CFL Limited has sought and continues to seek systematically to undo formerly agreed upon settlements (Case No. 3482 of 2015 / BR-2015-02338).

The emails between Dori Klagsbald in our analysis refer in no uncertain terms to a methodology for undoing the IVA and dragging the Gertner brothers’ names through the silt, with what can only be deemed to be a carefully constructed PR campaign (steps to be taken “if necessary”).  The party in whose interest this carefully crafted scheme has been devised, is an Israeli owned company CFL Finance (a Dan Gertler company). CFL was in 2015 allegedly owed only 12Million Pounds, a paltry amount in comparison to the 557M pounds that was the subject of the IVA and the agreed repayment to Haupthing. Again, to reiterate much of the currently disputed money is comprised of interest and penalties. The fact that it is still ungoing and leaves the Gertner brothers in a constant stated of disquiet is likely of greater value to Gertler.

We reiterate the articles and the historical context should not be taken in a vacuum. In fact, we contend that the death of Katumba , the information regarding the Fleurette Group, Glencore Plc, Ellesmere Global (BVI) can similarly not be read exclusive of the other articles and the timeframe involved. When read in context with an earlier published Ha’Aretz article and dozens of other articles and publications, it is abundantly clear that Dan Gertler, along with his attorneys and public relations firms, has since at least 2013 made concerted and systematic efforts in no uncertain terms to destroy anyone or anything that stands in the way of his constantly increasing wealth.

In the case of the death of Katumba, we can only speculate. In the ongoing legal battles against Moises Gertner and his brother who were at one time business partners of Dan Gertler, we maintain that Gertler was and continues to be intent upon decimation and they continue to be his victims.

We begin describing this saga by re-posting the 42 screenshots taken from the Purifying Africa Blogspot.

We will continue by slowly introducing the cast of questionable figures including another character in this case of Gertler v. Gertner, an Israeli lawyer named Yaakov Weinrot. We note Mr. Weinrot claims to have been owed many millions of dollars by the Gertner brothers, was apparently hired by them in the context of their dealings in the Congo; but also apparently participated in the smear campaign against them on behalf of Dan Gertler. We leave that piece for another day.

Our sources are publicly available. As many of the articles state, the Congo is one of the worlds most mineral-rich countries. And yet, it is the poorest and least developed. The Congolese people are the victims of extraordinary greed, the greed of their government, the greed of so-called “investors” like Dan Gertler and the corresponding corruption and fraud.

Finally, we note in the interest of full disclosure that we have not independently investigated the Gertner brothers on their other dealings, most of which appear to have been real estate investments. We have found significant evidence of charitable giving but make no judgment one way or the other. We firmly believe them to be victims of Dan Gertler and his  ‘mafia’ of attorneys, PR firms, and co-conspirators. We write the series of exposés in the hopes that perhaps the Gertner brothers and numerous other victims of Dan Gertler and his associates’ greed will find justice.

The Images:

 

 

With Israeli Billionaires Profiting From Human Capital in Congo, What Responsibility do they Play?

 

Congo rights group: Army kills 12 rebels after Beni attacks

BENI, Congo — Congo’s army fought off attacks in and around the eastern city of Beni on Thursday, killing at least 12 assailants and capturing seven, a local human rights group said.

Two soldiers also were killed in the fighting and several people were wounded, including students taking exams, said Omar Kavota, executive director of the Center for Studies of Peace and Defense of Human Rights.

Kavota blamed a new rebel coalition for the bombing of a school and attempted attacks on a women’s prison, a police station and the town hall.

The death toll could rise as Congo’s military pursues other attackers, he said.

Beni Mayor Nyonyi Bwanakawa blamed the attack on Mai Mai rebels. Kavota, however, warned that a new rebel coalition has formed outside Beni after armed men on June 11 attacked the city’s central Kangbayi prison, killing at least 11 and freeing 900 prisoners.

The new coalition, which Kavota called the National Revolutionaries Movement, is likely composed of rebels from the Mai Mai, Allied Democratic Forces and former M23 members who escaped prison.

Kavota said the new coalition may have external political and military support, given the logistics of the attacks, and he called on the government and military to quickly dismantle the group.

Kavota, whose organization tracks civilian deaths in the region, also called on the military to increase protection of civilians and public places.

Eastern Congo is home to multiple armed groups that compete for control of the region’s vast mineral resources.

http://www.startribune.com/congo-rights-activist-says-army-kills-7-attackers-in-beni/430095063/

SEE ALSO:

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Yesterday
Congo peacekeepers accused of sex abuse to leave CAR Al Jazeera, Qatar 21:31 Wed, 21 Jun
UN Says Congo Withdrawing Troops From CAR Mission Voice of America 21:25 Wed, 21 Jun
Supporting the Democratic Process in the DRC Voice of America 20:25 Wed, 21 Jun
“Sexus Plexus Nexus” Pitchfork 14:00 Wed, 21 Jun
Turkish deputy PM hails Turkey-Congo relations Anadolu Agency 13:44 Wed, 21 Jun
‘UN unable to solve the crisis in DRC’ Deutsche Welle 13:02 Wed, 21 Jun
Phil Clark: UN un able to solve the crisis in DRC Deutsche Welle 12:42 Wed, 21 Jun
Understanding vaccine derived polio outbreaks Rotary International 11:30 Wed, 21 Jun
Congo’s Escalating Political Crisis Sends Millions Into Exile The Wall Street Journal 06:19 Wed, 21 Jun
The DRC can learn from Lumumba as its internal crisis deepens Mail & Guardian Africa 05:49 Wed, 21 Jun
First Cobalt announces Kipoi East exploration program Energy Business Review 04:30 Wed, 21 Jun
Civilians bear the brunt of fresh fighting in DRC Al Jazeera, Qatar 03:17 Wed, 21 Jun
Tuesday
Congolese Militia Is Accused of Atrocities The New York Times 22:23 Tue, 20 Jun
No aid for Kasaï crisis victims in the DRC New Vision, Uganda 17:54 Tue, 20 Jun
Sexual Violence Fuels Vicious Recruitment Cycle in Congolese Militia Inter Press Service News Agency 16:04 Tue, 20 Jun

 

The Death of Katumba?- a Billionaire Financier’s 29,900%, Congo, Fleurette, and a Funeral Embrace

gertlerkabila-e1475244619953

Questions for our Readers to Ponder:

Was the death of Augustin Katumba Mwake in 2012 an accident?

Is what appears to be a very close relationship between Joseph Kabila, (who wrested control of Congo after his father was assassinated) and Dan Gertler deniable?

Had Dan Gertler as of 2014 really attracted $7 billion worth of investment in the Congo (as he claimed to critics then) or simply exploited the country for its resources, and the Congolese people for cheap labor?

How many of the events depicted in news today are attributable to the relationships that Mr. Gertler has with Kabila and the exchanges that have been made for mining rights?

 

DRC mining billionaire turns 29,900% profit on oil deal

Billionaire mining financier Dan Gertler has been accused by human rights group Global Witness of a strip and flip transaction in the Democratic Republic of Congo.

Bloomberg reports according to official records Nessergy, an oil driller owned by the Israeli businessman, paid $500,000 for 95% of Congo’s portion of the offshore block in 2006.

Congo’s government paid $150 million to buy it back last year, according to le Soft, a Kinshasa-based newspaper, but none of the details of the transaction has been made public despite DRC government regulations requiring large contracts involving the country’s natural resources be made publicly available within 60 days.

Bloomberg could not secure comments from either Nessergy nor the African nation’s Oil Minister, while Gertler’s financing firm, the Fleurette Group, said it is protected by confidentiality agreements with the DRC and Angola, which are jointly developing the field.

Reuters quotes a Fleurette spokesperson as saying the $500,000 signing bonus was “the standard amount companies paid to Congo for oil rights at the time the contract was agreed” and that the block’s value had risen sharply since discoveries in nearby Angolan fields.

It is not the first time Gertler’s name has been mentioned with regard to questionable natural resource deals in the DRC.

Gertler is the grandson of Moshe Schnitzer, Israeli diamond exchange founder, and arrived in the Congo in 1997 shortly after the military coup that put current president Joseph Kabila’s father in charge of the resource rich country which is almost the size of Western Europe.

Gertler is said to have used his relationship with the younger Kabila and his now late adviser Augustin Katumba Mwanke to bag mining projects “by stripping from others if necessary, only to sell them on at great profit.”

Now delisted Kazakh mining group ENRC, was forced to pay out $1.25 billion to Canadian mining firm First Quantum in 2012 after the DRC government expropriated First Quantum’s Kolwezi copper projects in the country only to sell them onto ENRC via Gertler.

ENRC acquired a 50.5% stake in Camrose, a company controlled by the Gertler family trust, for $550 million last year.

Camrose owns a stake in Africo Resources, listed in Toronto, which partners with DRC’s state-owned Gecamines in various copper-cobalt, gold and iron projects and dominates the DRC diamond trade.

Kabila has on occasion dispatched Gertler as special peace envoy for the DRC and Gertler answers his critics by saying he’s attracted $7 billion worth of much-needed investment to the war-torn country.

http://www.mining.com/drc-mining-billionaire-turns-29900-profit-on-oil-deal-70917/

Dan Gertler: Glencore, Katanga Mining and Ellesmere Global Limited (BVI) – Trust for Gertler’s Family (2012)

To read this article in its entirety: http://foreignpolicy.com/2012/04/23/glencore-what-the-documents-tell-us/

Glencore: What the Documents Tell Us

“Ken Silverstein’s riveting investigation of Glencore, the “biggest company you never heard of.” Below are some of the documents he uncovered in his year of reporting on the hyper-secret, shady global commodities giant.”

It is big, very big. The 1,637-page initial public offering (IPO) prospectus Glencore released last year revealed just how vast its reach is: The company controls more than half the international tradable market in zinc and copper and about a third of the world’s seaborne coal; is one of the world’s largest grain exporters, with about 9 percent of the global market; and handles 3 percent of daily global oil consumption. All of this, the prospectus says, helped the firm post revenues of $186 billion in 2011. Click here to see the prospectus document.

It is not afraid of operating in high-risk “frontier” regions. In a report on the IPO, Deutsche Bank says the company “benefits directly from the volatility” in global commodity prices — especially in poor countries. Consider what the bank identifies as Glencore’s “key drivers” of growth: copper in the Democratic Republic of the Congo (DRC), coal in Colombia, oil and natural gas in Equatorial Guinea, and gold in Kazakhstan. Deutsche Bank delicately calls these places “frontier regions” or “challenging political jurisdictions” — put simply, they all offer a dangerous mix of extraordinary natural wealth and various degrees of instability. (See page 12.)

It is well-connected in failed states. Glencore has managed to do business in the DRC, the poster child of the resource-cursed failed state, with the help of Dan Gertler, a diamond businessman from Israel who is known for his intimate ties to President Joseph Kabila. (He even reportedly has lent Kabila his private jet.) Glencore and Gertler are, through subsidiaries, shareholders in Katanga Mining. In 2009, Glencore sold stock in Katanga at roughly 60 percent of its market value to Ellesmere Global Limited, a British Virgin Islands firm whose “ultimate owner is a trust for the benefit of the family members of Dan Gertler,” according to Canadian insider-trading records. Ellesmere quickly sold the stock back to Glencore at close to full market price, netting a profit of about $26 million.

It pays associates in unusual deals. In another example, detailed in this March 2011 contract, Samref Congo Sprl, a subsidiary 50 percent owned by Glencore, waived its rights of first refusal to acquire an additional stake in Mutanda Mining, a copper and cobalt producer, from Gecamines, Congo’s state-owned mining company. Samref instead recommended that the shares be sold to Rowny Assets Limited, one of the offshore firms owned by Gertler’s family trust. (See clauses C and D on pages 3-4 of the Gecamines contract.) It’s not clear why Samref would have passed on the Gecamines offer, because business records and documents suggest that Gertler’s trust picked up the Mutanda shares for a fraction of their value. Plus, the president and vice president of the Panama-registered Samref Overseas S.A., which owns Samref Congo Sprl, are both Glencore officials, and the vice president, Aristotelis Mistakidis, is even one of the handful of Glencore executives who became billionaires after the IPO. “We preferred to invest our money in developing Mutanda — building the mines and the plant,” Glencore spokesman Simon Buerk said in an e-mail explaining why the firm did not buy the shares.

It knows how to look the other way. In Congo-Brazzaville, Glencore bought oil from shell companies set up by the state oil company’s head, Denis Gokana (conveniently trained at its London office), according to a lawsuit by Kensington International, a Cayman Islands-based corporation. Glencore complied with court orders and was not charged, but the ruling judge wrote that he “did not consider that Glencore’s personnel … could not have appreciated that Sphynx Bermuda [another company named in the suit that had contracted with Glencore] was somehow linked to the Congo (although ignorant of the exact nature of the link) and that payment would ultimately go to the SNPC [National Petroleum Company of the Congo].)

It has a criminal past. Leveraging ties to dictators has always been at the heart of the business empire built by famous fugitive Marc Rich. Although Rich left the firm in the 1990s, Glencore profited handsomely by dealing with Saddam Hussein under the 1996-2003 U.N. Oil-for-Food Program, which allowed the Iraqi dictator to trade limited quantities of oil in exchange for humanitarian supplies. The U.N.’s Independent Inquiry Committee reported in 2005 that Hussein had awarded special “allocations” to companies and individuals who were friendly to the regime — including Pakistani businessman Murtaza Lakhani, a Glencore agent and conspicuous regime sycophant. The Iraq Survey Group, the U.S.-led fact-finding mission sent after the invasion, concluded that Glencore was “one of the most active purchasers” of oil under the Oil-for-Food Program and had paid $3,222,780 in “illegal surcharges.” Glencore was not charged in the scandal. It claimed it was unaware surcharges were being paid and that Lakhani’s high fees reflected the extra risk of doing business with Iraq, not slush money for bribes. (See page 144.)

It stashes money in tax havens. Another reason Glencore is so rich: Its effective global tax rate for 2010 was just 9.3 percent, in large part because nearly half its 46 subsidiaries are incorporated in “secrecy jurisdictions,” opaque financial havens like the Netherlands, according to a report by the NGO Publish What You Pay.

Its business partners have been investigated for bribery. Glencore’s shady dealings reach around the world. To take just one example, a 2008 U.S. Senate report revealed that an unidentified client of the LGT Group, a bank owned by Liechtenstein’s royal family, discussed setting up a Panamanian shell corporation and bogus foundation to pay bribes on Glencore’s behalf. “A small portion of the payments go … to the USA and Panama and may be classified as bribes,” reads an internal LGT memo. The client, a Glencore agent, had set up the account in 2002; prior to that, Glencore had made such payments directly, the memo says. An LGT executive refused to testify to the Senate about whether the bank had set up the Panamanian corporation or foundation as requested.

It has worked with Romanian criminals. In the mid-2000s, Glencore used an Israeli agent named Yoav Stern, who also represented the Romanian interests of Yakov Goldovsky, who had previously been convicted in Russia for asset-stripping state-run enterprises. Another Glencore business partner here was Romanian businessman Marian Iancu. Glencore sold him crude oil through an offshore company he controlled, Faber Invest & Trade, for processing at the Rafo refinery in Romania. Iancu was indicted for tax evasion and money laundering in 2006 and convicted in late 2011. A WikiLeaked U.S. State Department cable described Rafo as “embroiled in a web of corruption, money laundering, fraud and criminal charges” and included Faber among its “shady entities.”

It has done deals with oligarchs. Glencore funneled roughly $2 billion through an offshore company to the oligarch Mikhail Gutseriev, described in a WikiLeaked cable as “not known for his transparent corporate governance.” Reportedly booted by the Kremlin as chief of the state-owned oil firm Slavneft for resisting the company’s privatization, Gutseriev made a comeback with Glencore’s help. The cash infusion allowed Gutseriev to establish RussNeft, now one of Russia’s largest oil companies. Glencore owns nearly half the equity of four of RussNeft’s oil production subsidiaries and has sole rights to market its oil.

It has high-level political protection:  In Kazakhstan, Glencore owns slightly more than half of Kazzinc, a huge gold, lead, and zinc producer. Because corruption can make the country treacherous terrain for foreign investors, they often require a powerful local sponsor with close contacts to the resident, Nursultan Nazarbayev. Glencore’s is one of the best: Bulat Utemuratov, a major investor in Verny Capital, Kazzinc’s second-largest shareholder with a 42 percent stake. In March 2011, a group of opposition politicians issued a public letter complaining that Kazzinc and other former state firms had been privatized under murky conditions that allowed Utemuratov and other insiders to pick up vast stakes thanks to their ties to the ruling family. Glencore could be stripped of its assets in the country, said the letter, adding, “Upon any change of regime in Kazakhstan to a democratic one, any acquisition of any shares in Kazzinc … will be subject to review.”

Please read the article in its entirety from Foreign Policy: http://foreignpolicy.com/2012/04/23/glencore-what-the-documents-tell-us/