Glencore faces new corruption probe in Switzerland
Sources close to Glencore said June 19 they expect “business
as usual” at the Swiss-based international trader and miner even following the
opening of a fourth investigation in less than two years into how the company
runs its business.
Glencore said in a statement June 19 that it has been
informed by the Office of the Attorney General of Switzerland that the OAG has
opened a criminal investigation into Glencore International AG “for failure to
have the organizational measures in place to prevent alleged corruption in the
Democratic Republic of Congo, currently under investigation by the OAG.”
Glencore said it will cooperate with the investigation by
the OAG.
The investigation won’t affect operations, sources close to
the company said.
Market sources told S&P Global Platts they believe the
latest investigation is a follow up from the US Department of Justice
investigation opened in July 2018 which also mentions Glencore’s operations in
the DRC, as well as in Venezuela and Nigeria.
In April 2019, the US Commodity Futures Trading Commission
(CFTC) launched an investigation into whether Glencore had violated certain
provisions of the Commodities Exchange Act. The CFTC is also investigating the
Swiss-based trading and mining company, and its subsidiaries, over potential
corrupt practices in connection with commodities, it said in a statement.
Glencore confirmed in December 2019 that the UK government’s
Serious Fraud Office had opened up an investigation into suspicions of bribery
at the company.
Glencore is the largest copper producer on the African
continent, and has recently boosted production at its Katanga mine in the DRC,
where it also produces cobalt.
The DRC produces more than 60% of the world’s supplies of
cobalt, demand for which has jumped in recent years for use in mobile phone and
electric vehicle batteries. It also has some of the world’s richest untapped
reserves of copper, vital to the energy transition infrastructure chain.
Ivanhoe Mines and China Molybdenum Company’s Tenke Fungurume Mining are among
other major miners active in the country.
In 2018 the government of the DRC introduced a new Mining
Code which sought to raise royalty levels and state participation in mining
companies at the same time placing emphasis on empowering local business and
downstream investments. Members of the country’s Chamber of Mines said at the
time that the new code had led to a series of negotiations between government
and international miners who were unhappy with the terms of the new code.
Late last year Glencore said it was joining the Responsible
Sourcing Blockchain Network (RSBN) to support responsible sourcing and
production practice industry-wide. The initiative is designed to improve supply
chain traceability and transparency and integrate good practice with supply
chain partners, and was to be implemented at Glencore’s cobalt businesses,
later to be extended to its businesses in other battery metals.
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