Australia watchdog takes Rio Tinto, executives to court over Mozambique deal – by Sonali Paul (Reuters U.S. – March 2, 2018)

MELBOURNE (Reuters) – Australia’s corporate watchdog said on Friday it has launched court action against miner Rio Tinto (RIO.AX)(RIO.L) and two former executives for misleading investors about the coal reserves it reported in a $4 billion acquisition in Mozambique.

The Australian Securities and Investments Commission said the company, its former Chief Executive Tom Albanese and former Chief Financial Officer Guy Elliott had made deceptive statements in their 2011 annual report, published in 2012.

“ASIC alleges that RTL (Rio Tinto Ltd) engaged in misleading or deceptive conduct by publishing statements in the 2011 annual report, signed by Mr Albanese and Mr Elliott, misrepresenting the reserves and resources of RTCM (Rio Tinto Coal Mozambique),” the commission said in a statement.

“We will respond once we have had an opportunity to consider the allegations in full,” Rio Tinto said in an emailed statement. Rio shares were down 0.8 percent at 3,748 pence in early trade in London.

The company has denied any wrongdoing in a similar case brought by the U.S. Securities and Exchange Commission. Rio Tinto now faces court cases in the United States and Australia over its disastrous acquisition of Riversdale in Mozambique, with the U.S. SEC having charged the company, Albanese and Elliott with fraud.

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