U.S. SEC says Rio Tinto, ex-CEO, ex-CFO must face fraud case – by Jonathan Stempel (Reuters U.S. – January 23, 2018)


NEW YORK (Reuters) – The top U.S. securities regulator on Tuesday rejected arguments by Rio Tinto Plc and two former top executives that its civil lawsuit claiming they concealed the plunging value of coal assets owned by the big Anglo-Australian mining company should be dismissed.

In letters filed with the U.S. District Court in Manhattan, the Securities and Exchange Commission said its complaint adequately alleged that fraud occurred, and that Rio Tinto, former Chief Executive Thomas Albanese and former Chief Financial Officer Guy Elliott intended to deceive investors.

Rio Tinto responded by referring to its statement in October that it believed the lawsuit was unwarranted and that a court or jury would reject the SEC’s claims.

Lawyers for the defendants did not immediately respond to requests for comment or had no immediate comment. The SEC accused Rio Tinto of ignoring the need to write down most of the value of Mozambique coal assets it had bought for $3.7 billion in April 2011, while it was raising roughly $5.5 billion from U.S. investors.

Rio Tinto wrote off most of the value in January 2013, and sold the assets in late 2014 for just $50 million.

For the rest of this article: https://www.reuters.com/article/rio-tinto-sec/u-s-sec-says-rio-tinto-ex-ceo-ex-cfo-must-face-fraud-case-idUSKBN1FC38X