Today’s edition of the UK’s Daily Mail has reported that FTSE 100 miner ENRC has “resolved not to buy mineral rights via controversial middlemen who campaign groups say pose an appearance or risk of corruption”. The article says that ENRC (Eurasian Natural Resources Corporation) has informed Dan Gertler - a businessman who has been involved with the company in the Democratic Republic of Congo – that it cannot risk buying any more mining rights through him. The piece is unattributed. In e-mails to Global Witness, ENRC declined to comment and a spokesman for Mr Gertler said that the Daily Mail article is “untrue and without foundation.”
Global Witness believes the news story is encouraging, notwithstanding Mr Gertler’s denial. However, ENRC will need to convince investors and the public that any such changes are not simply cosmetic. Furthermore, the company still has a lot of explaining to do regarding the deals it has struck in Congo. Global Witness issued a memo to ENRC shareholders on 12 June this year pointing out corruption risks around an estimated $3.8 billion-worth of investments in Congo, most – possibly all - of which have involved Mr Gertler.
The memo outlines a number of corruption risks in these deals, relating to the role played by offshore companies connected with Mr Gertler, who is a friend of Congolese President Joseph Kabila. Mr Gertler has, through his representatives, denied any corrupt activity and said that his offshore companies are beneficially owned solely by members of his family.
Global Witness has called on ENRC to publish an audit that it has commissioned into corruption allegations and to publicly declare the beneficiaries of all companies with which it does business. Without such transparency it will be extremely difficult for ENRC to draw a line under its turbulent past.
Click here for Global Witness’s 12 June memo to ENRC shareholders.
Notes to editors:
1. The full link for the 12 June 2012 Global Witness memo is: http://bit.ly/PMCBzW
2. The Daily Mail article, “ENRC clamps down on opaque mining deals”, can be found at: http://bit.ly/TM4VhH
Contact: Daniel Balint-Kurti, Campaign Leader, DRC: +44 207 492 5872; +44 7912 517 146.