Rio Tinto consents to $15M civil penalty to settle SEC ‘bribery scheme’ charges

The Securities and Exchange Commission announced charges against global mining and metals company, Rio Tinto plc, for violations of the Foreign Corrupt Practices Act, FCPA, arising out of a bribery scheme involving a consultant in Guinea. The company has agreed to pay a $15M civil penalty to settle the SEC’s charges. The SEC’s order finds that, in July 2011, Rio Tinto hired a French investment banker and close friend of a former senior Guinean government official as a consultant to help the company retain its mining rights in the Simandou mountain region in Guinea. The consultant began working on behalf of Rio Tinto without a written agreement defining the scope of his services or deliverables. Eventually the mining rights were retained, and the consultant was paid $10.5 million for his services, which Rio Tinto never verified. The SEC’s investigation uncovered that the consultant, acting as Rio Tinto’s agent, offered and attempted to make an improper payment of at least $822,000 to a Guinean government official in connection with the consultant’s efforts to help Rio Tinto retain its mining rights. Furthermore, none of the payments to the consultant was accurately reflected in Rio Tinto’s books and records, and the company failed to have sufficient internal accounting controls in place to detect or prevent the misconduct. The mine has not been developed by Rio Tinto…Rio Tinto consented to the SEC’s order without admitting or denying the findings that it violated the books and records and internal accounting controls provisions of the Securities Exchange Act of 1934 and agreed to pay a $15M civil penalty. Reference Link