Type of Claim: Section 90 and section 90A FSMA claims
Claim Period: 11 May 2011 to 2 July 2018
Defendants: Glencore Plc
Governing Law: English law
Limitation: To be determined
On 9 March 2018 Joseph Kabila, President of Democratic Republic of Congo (DRC), signed the new DRC mining code into law. On 22 April 2018 Gécamines, the DRC’s state owned mining company, filed legal action against Glencore. On 27 April 2018 Israeli billionaire Dan Gertler filed freezing orders against Glencore’s two mines in the DRC.
On 18 May 2018 Glencore shares fall on news that the UK’s Serious Fraud Office (SFO) is looking at Glencore’s ties to Mr Gertler.
On 12 June 2018 Glencore writes off $5.6bn to end DRC dispute with Gécamines.
On 15 June 2018 Glencore settles legal dispute with Mr Gertler, making royalty payments to him in euros so as to not fall foul of US sanctions. Mr Gertler was placed on a US sanctions list in December 2017 because of “opaque and corrupt mining and oil deals” in the DRC.
On 3 July 2018, Glencore announced that a subsidiary had received a subpoena from the United States Department of Justice (DOJ) to produce documents and other records with respect to compliance with the Foreign Corrupt Practices Act and United States money laundering statutes. The requested documents relate to the Glencore Group’s business in Nigeria, the Democratic Republic of Congo and Venezuela from 2007 to present.
On 25 April 2019 Glencore announced that it “…has been informed by the United States Commodity Futures Trading Commission (CFTC) that the CFTC is investigating whether Glencore and its subsidiaries may have violated certain provisions of the Commodity Exchange Act and/or CFTC Regulations through corrupt practices in connection with commodities. Glencore understands that the CFTC’s investigations are at an early stage and have a similar scope in terms of subject matter as the current ongoing investigation by the DOJ. Glencore will cooperate with the CFTC. Glencore’s response will be managed by its Investigations Committee, which was set up in July 2018 to oversee Glencore’s response to the investigation by the DOJ.”
On 9 July 2018 a US Class Action was filed in the US District Court of New Jersey on behalf of persons or entities who purchased or otherwise acquired publicly traded Glencore securities from 30 September 2016 through to 2 July 2018. An amended complaint was filed on 7 January 2020.
On 5 December 2019 Glencore announced that the Serious Fraud Office (SFO) had opened an investigation into suspicions of bribery in the conduct of business of the Glencore group and the SFO confirmed this later that day with the statement that: “Following the announcement by Glencore PLC, the SFO confirms it is investigating suspicions of bribery in the conduct of business by the Glencore group of companies, its officials, employees, agents and associated persons”.
On 19 June 2020 Glencore announced that the Office of the Attorney General of Switzerland (OAG) had opened a criminal investigation into Glencore International AG for failure to prevent alleged corruption in the Democratic Republic of Congo. This comes on top of the investigations by the UK Serious Fraud Office, US Department of Justice and the Commodity Futures Trading Commission.
Stewarts are monitoring the situation to determine whether shareholders of Glencore and Xstrata may have a claim against Glencore in the English courts and are awaiting the findings of the SFO, DOJ and CFTC investigations.
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