23 Feb

Congo Bribery Probe Puts Israeli Billionaire’s Future on Hold

A 20-year friendship that helped turn Dan Gertler into a billionaire has left the Israeli businessman with a lot fewer places to go.

The U.S. government accused Gertler of corrupt mining and oil deals in the Democratic Republic of Congo and said he acted as a middle-man to enrich his longtime buddy, President Joseph Kabila.

The two have been close since Gertler arrived as a young diamond merchant during a civil war in 1997, and Congo — one of Africa’s poorest countries — is the main source of his wealth.

“Most of my business is in the Congo and my faith is in the Congo,” Gertler, 44, said in a rare interview on Dec. 21, just hours before the U.S. government imposed economic sanctions against him.

At the time, he remained defiantly optimistic about his businesses even as he was being singled out by American and British investigators conducting prolonged bribery and corruption probes related to some of his Congo deals.
“I am a strong believer in the future of the Congo,” he said. But doing anything inside and out of Africa has gotten a lot harder for him in the past two months.
Sanctions have shut Gertler out of the American financial system, halting access to the dollars that are the main currency used in Congo and in global raw-material deals. U.S. companies are banned from doing business with him. Former partners are distancing themselves.
“All our payments have ceased forthwith,” said Mark Bristow, the chief executive officer of Randgold Resources Ltd., which has a gold exploration project with Gertler’s Fleurette Group in northeast Congo. “We’ve got U.S. directors, and we are listed on the Nasdaq. We cannot entertain doing business and transacting in any form.”
To be sure, Congo’s government stands by Gertler, who still holds mineral and oil rights in the country and funds education and health centers.
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15 Jan

Glencore Shrinks Job of Billionaire Copper Head Amid Congo Probe

Glencore Plc reduced the role of its billionaire head of copper, Aristotelis Mistakidis, shaking up the business after a review in the Democratic Republic of Congo raised questions about accounting and management.

Mistakidis, one of Glencore’s largest shareholders and a key lieutenant of Chief Executive Officer Ivan Glasenberg for more than a decade, will lose control of industrial copper operations including mines and focus on the trading side of the business, according to people familiar with the plans.

Responsibility for Glencore’s copper assets will move to Mike Ciricillo, who now oversees copper smelting and refining, the people said, declining to be identified as the appointment isn’t yet public.

The shake-up reduces Mistakidis’s responsibilities after he and two other executives resigned from the board of Glencore’s Katanga Mining Ltd. in Congo in November. A review by Katanga led to a restatement of its financial reporting, and a commitment from Glencore to restructure the management of its own copper business.

Close Relationship

Mistakidis, whose holding in the company is valued at about $2.5 billion, is a key part of Glencore. He’s the third-biggest shareholder among management and helped lead the company’s ascent from a scrappy trader to a diversified commodities giant and the world’s third-biggest copper miner.

For years Mistakidis, better known as “Telis,” had run both the marketing and producing sides of the copper business, a testament to his record as a trader and close relationship with Glasenberg.

Ciricillo, who ran Freeport-McMoRan Inc.’s copper operations in Congo prior to joining Glencore in 2014, takes on the new role at a critical time for the Swiss commodity giant. Glencore plans to grow global copper production by about 25 percent to 1.64 million metric tons by 2020, largely through the resumption of operations at Katanga.

To read the full article, click here.

22 Dec

U.S. Sanctions Israeli Billionaire Gertler Over Congo Deals

The U.S. sanctioned Israeli billionaire Dan Gertler, one of the biggest individual mining investors in the Democratic Republic of Congo, in what it calls a clampdown on human-rights abusers and corrupt actors.

 The U.S. Treasury said Gertler has used his close relationship with the country’s president, Joseph Kabila, to amass a fortune through corrupt and opaque deals. Between 2010 and 2012 alone, Congo reportedly lost over $1.36 billion in revenues from the underpricing of mining assets that were sold to offshore companies linked to Gertler, it 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,” the U.S. Treasury said in a statement.

Under the sanctions, any assets held by Gertler within U.S. jurisdictions will be blocked and U.S. individuals are prohibited from engaging in transactions with them.

Read more: U.S. sanctions 13 in global human rights abuse crackdown

The U.S. “is taking a strong stand against human rights abuse and corruption globally by shutting these bad actors out of the U.S. financial system,” Treasury Secretary Steven Mnuchin said in the statement. “Treasury is freezing their assets and publicly denouncing the egregious acts they’ve committed, sending a message that there is a steep price to pay for their misdeeds.”

Gertler’s representatives at his office in Ramat Gan, Israel, and a public relations firm in London, said they could not immediately respond to the U.S. action. Glencore complies with all applicable sanctions, a spokesman for Glencore said by phone.

Diamond Dealer

Gertler, whose grandfather co-founded Israel’s diamond exchange 70 years ago, arrived in Congo in 1997. The then 23-year-old soon secured a monopoly on the country’s diamond sales from Laurent Kabila, the then-president and father of Congo’s current leader, whose rebellion had just overthrown the three-decade-long regime of Mobutu Sese Seko.

To read the full article, click here.

06 Dec

Angola Gem Firm Distances Itself From Former President’s Family

An Angolan state-owned diamond company is pulling out of an investment in a Swiss firm controlled by the husband of the billionaire daughter of the former president, as the country’s new leader untangles it from the business interests of his predecessor’s family.

Sodiam will divest a stake in Geneva-based jewelry maker De Grisogono for “reasons of public interest and legality,” it said in a statement after a board meeting on Dec. 1, without giving details of how the transaction would be completed.

The company is controlled by Sindika Dokolo, the husband of Isabel dos Santos, the eldest daughter of former Angolan President Jose Eduardo dos Santos, according to Ana Gomes, a Portuguese member of the European Parliament who has done research on the business interests of Africa’s richest woman.

The move comes as President Joao Lourenco seeks to distance the oil-rich country from the influence of Dos Santos and his family. He’s fired Isabel from her position as chairman of state-owned oil company Sonangol, and last week announced plans to auction a new telecoms license to compete with Unitel SA, which she controls. Lourenco, known as J-Lo in Angola, replaced dos Santos, who has nevertheless remained head of the ruling MPLA party.

Tribune de Geneve reported earlier Tuesday about Sodiam’s exit from De Grisogono. The company lost money on the investment, it said. A call to the offices of De Grisogono wasn’t answered.

Sodiam is a former unit of Endiama, another state-owned diamond company in Africa’s biggest producer of the precious gems.

Source: https://www.bloomberg.com/news/articles/2017-12-05/angola-gem-firm-distances-itself-from-former-presidents-family