Cape Town - The National Prosecuting Authority (NPA) has remained tight-lipped on whether or not it would be investigating alleged wrong-doing by commodity company, Glencore – in light of a $1.186 billion (R18 461bn) settlement the company entered into with the US Department of Justice after pleading guilty to several charges of corrupt practices in dealing with foreign governments.
“Kindly note that as a matter of policy the NPA does not comment on investigations,” NPA spokesperson, Mthunzi Mhaga said.
This development comes a week after Glencore admitted to a decade-long scheme along with its subsidiaries to make and conceal corrupt payments and bribes, following a co-ordinated resolution with criminal and civil authorities in the US, UK, and Brazil.
Glencore pleaded guilty and agreed to pay more than $1.1 billion to resolve the US government’s investigations into violations of the Foreign Corrupt Practices Act (FCPA) and a commodity price manipulation scheme.
Separately, the US Justice Department said Glencore also admitted to engaging in a multi-year scheme to manipulate fuel oil prices at two of the busiest commercial shipping ports in the US.
US Attorney for the Southern District of New York, Damian Williams said: “In the foreign bribery case, Glencore International AG and its subsidiaries bribed corrupt intermediaries and foreign officials in seven countries for over a decade.
“In the commodity price manipulation scheme, Glencore Ltd undermined public confidence by creating the false appearance of supply and demand to manipulate oil prices.
“The scope of this criminal bribery scheme is staggering.
“Glencore paid bribes to secure oil contracts.
“Glencore paid bribes to avoid government audits.
“Glencore bribed judges to make lawsuits disappear.
“At bottom, Glencore paid bribes to make money – hundreds of millions of dollars.
“And it did so with the approval, and even encouragement, of its top executives.
“The criminal charges filed against Glencore in the Southern District of New York are another step in making clear that no one – not even multinational corporations – is above the law.”
Sentencing has been scheduled in the market manipulation case for June 24, and a control date for sentencing in the FCPA case has been set for October 3.
United Democratic Movement (UDM) leader, Bantu Holomisa wrote to the Public Protector, Busisiwe Mkhwebane to investigate Glencore’s possible corruption links in South Africa.
He said although the country was not specifically cited in Glencore’s US indictment, “the likelihood of these practices happening in South Africa is quite high, especially given Brian Molefe’s testimony at the Zondo commission”.
At the Zondo commission, former chief executives Molefe and Matshela Koko both testified that there had been an adversarial relationship between the power utility and Glencore.
Molefe has in the past accused Glencore of supplying sub-standard coal to Eskom while also increasing the prices.
Koko said when Glencore supplied coal that was non-compliant to Eskom, they failed to pay the penalties. Optimum under Glencore has not paid Eskom what is due to Eskom, which is more than R2bn”.
Molefe alleged Glencore embarked on a politically motivated move to partner with Ramaphosa, who was the ANC’s deputy president at the time, and appointed him chairperson of its subsidiary, Optimum.
Eskom did not respond to requests for comment by deadline.
Glencore meanwhile said none of the US investigations relate to their business in South Africa or its “coal, ferroalloys or Astron businesses”.
“We acknowledge the misconduct identified in these investigations and have clearly stated that this type of behaviour has no place in the Glencore of today.
“We are committed going forward to operating transparently under a well-defined set of values, with openness and integrity at the forefront,” Glencore said in a statement.
“Regarding the allegations relating to Optimum Coal, Glencore co-operated fully with the public protector investigation and Zondo commission into state capture.
“Glencore denies any allegation of wrongdoing and the conclusion of both processes confirms this.”
Lawyer Michael Bagraim said the government was obliged to pursue the matter for several reasons.
“Glencore certainly did a lot of business in South Africa during that time when it was alleged that they committed criminal offences.
“Number two, they were supplying Eskom with an enormous amount of coal.
“Number three, at the time a president of South Africa was heavily involved with the coal mining industry.
“Number four, in essence if there was any bribery or negative activity then it would count against President Ramaphosa.
“Number five, the police have shown reluctance to investigate anything which might taint the ANC.
“Number six, if the police refuse to investigate then it should be escalated to a parliamentary portfolio committee who will ask the hard questions and demand responses.
“Number seven, if the public prosecutors refused to prosecute then any member of the public may demand that refusal in writing and pursue a private criminal case.
“Many private institutions are watching this very closely.
“It will be interesting to see if the prosecution authorities have the strength to hold a case against those in powerful positions.
“The jurisdictions abroad have pursued the case and our government is obliged to do likewise,” he said.
Policing expert and director at the Centre for Security and Intelligence Praxis (ACSIP), Eldred De Klerk said local authorities had every right to investigate but that it would be best for them to pursue the matter in the public interest.
“Until they have the evidence and basis for prosecution, they may be getting through all that quietly, putting in diplomatic requests takes a long time.
“Once done they can pursue a case.
“Especially if the company concerned is still busy in South Africa,” De Klerk said.
Cape Times