UK Serious Fraud Office launches probe into Rio Tinto over Simandou – by Frik Els ( – July 24, 2017)

The UK’s anti-fraud investigating body said Monday it is probing Rio Tinto’s dealings in Guinea involving the giant Simandou iron ore project.

“The Serious Fraud Office has opened an investigation into suspected corruption in the conduct of business in the Republic of Guinea by the Rio Tinto group, its employees and others associated with it,” the SFO said in a statement on Monday.

In November last year Melbourne-based Rio fired two executives involved in the project after an internal investigation uncovered a $10.5m payment in 2011 to a French national acting as a go-between with the West African nation’s government.

Rio, the world’s second largest mining company, announced in October it was fully exiting the project by selling its stake to former partner Chinalco for up to $1.3 billion. Rio has spent more than $3 billion advancing the project (including a $700m payment to the Guinea government to resolve “outstanding issues” in April 2011) having first acquired the property in the late nineties.

Shares in Rio Tinto lost nearly 2% of its value in London on Monday amid a generally positive day for the mining sector, reducing its market valuation to $79 billion. Rio stock is up just over 5% year to date in line with a better trading environment for miners.

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