Glencore shares fall on DRC probe fears

“Shares in London-listed mining giant Glencore have fallen 7% following a report of a potential investigation into its actions in Africa.

Glencore said it could not comment on a Bloomberg report that it may face an investigation into allegations of bribery linked to its operations in Democratic Republic of Congo.

The Serious Fraud Office (SFO) said it could neither confirm nor deny its interest in investigating Glencore.

Glencore shares dropped 7% to 370p.

The Bloomberg report said SFO investigators were preparing to seek permission for a full investigation into Glencore’s dealings with Israeli billionaire Dan Gertler and the leader of DRC Joseph Kabila.

In order for a full investigation to begin, sign-off is required by a senior SFO panel including its acting chief executive Mark Thompson.

Mr Gertler already faces sanctions by the US due to alleged corruption in the DRC.

When the US Office of Foreign Assets Control imposed sanctions on the billionaire in December it said he had deprived the developing country’s coffers of funds.

“Mr 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,” the ruling said.

“As a result, between 2010 and 2012 alone, the DRC reportedly lost over $1.36bn in revenues from the underpricing of mining assets that were sold to offshore companies linked to Gertler.””

Source – BBC News