In 2010 a strong fixer within the Democratic Republic of Congo (DRC) allegedly organised a $500 000 bribe for a neighborhood choose to make a $16 million lawsuit in opposition to Glencore subsidiary Katanga Copper Firm (KCC) go away.
The 2010 DRC courtroom case which Glencore’s fixer allegedly received quashed had been introduced by an organization known as Crusader Well being, owned by South Africa doctor-couple Ian and Laurethé Hagen.
In 2010 the Hagens had been in search of damages in a DRC courtroom after Glencore abruptly cancelled their firm’s contract to construct and function hospitals at copper mines within the DRC.
The cancellation of the Crusader Well being contract allegedly adopted the Hagens elevating alarms a few new medical supervisor imposed by Glencore.
They raised questions on whether or not the brand new supervisor, fellow South African André Hattingh, was correctly medically certified and claimed his affect stemmed from his being “intently linked to and sponsored by” Glencore and its DRC agent.
The Hagens’ contract pre-dated Glencore and Gertler taking management of the mines in query whereas Hattingh had already arrange a hospital for Glencore at one other mine.
The Hagens’ objections to their new medical supervisor had been allegedly met with a mystifyingly aggressive pushback culminating of their firm getting the boot – after which the launch of their ill-fated declare for damages.
Gertler’s lawyer informed amaBhungane, “Mr Gertler or anybody on his behalf was not social gathering to the proceedings filed by the Hagen household in opposition to Glencore. As acknowledged, neither Mr Gertler nor anybody on his behalf was concerned within the matter of the development of the hospital talked about in your letter and neither Mr Gertler nor anybody on his behalf is acquainted with the Hagen household or Mr Hattingh.”
When amaBhungane spoke to Hattingh he partly contradicted this, confirming he knew Gertler, however was not conscious of what he known as “the politics” of the termination of the Hagens’ contract and the next fallout.
The Gertler Household Basis on its web site mentions that it “employed famend South African medical physician, Dr Andre Hattingh, to handle all elements of the [Kisingani] hospital”, which it describes as a “signature” challenge.
In Glencore’s courtroom submitting setting out the corrupt actions it’s settling for, the corporate defined how the DRC choose was paid off through the “DRC Agent”.
The agent emailed a Glencore government on 3 November 2010 saying that he had talked to an unnamed “DRC official” and that he and this official can be assembly the choose within the Crusader matter to iron issues out.
The agent allegedly wrote that “[w]ithout [the DRC official’s] assist we will probably be screwed massive time, I imagine. We want political stress.”
They then “instructed that Glencore may be sure that [it] would prevail within the contract dispute if [he] had a “affordable quantity of ammunition to make it occur”.
The “ammunition” wanted was $500 000 and the agent despatched Glencore a faux bill for this quantity, supposedly from their legal professional for work accomplished on the Crusader dispute.
In actuality the cash “was used as a bribe cost to have the lawsuit dismissed,” says Glencore.
So as to add insult to harm, the agent allegedly additionally informed the Glencore government that Crusader’s personal lawyer was in on it and “able to play alongside for the great trigger”.
Now, 12 years later, Glencore has pleaded responsible to a staggering marketing campaign of bribery throughout the African continent in addition to Brazil and Venezuela – together with the bribe to quash the Hagens’ case.
The Hagens have seized on these admissions to intervene within the settlement course of, demanding that Glencore settle with them earlier than the bigger settlement is finalised.
Like Glencore, the Hagens anonymised “the DRC Agent” of their papers. In contrast to Glencore, they went to some lengths to determine this agent.
“On the request of [the Hagens], the [US] authorities has confirmed the identification of the DRC Agent. He’s a person who operated on the DRC Companion’s behalf within the DRC and facilitated the cost of bribes to additional the DRC Companion’s pursuits,” they famous, referencing an Ontario Securities Fee settlement settlement that made it clear they had been fingering Deboutte and Gertler.
The episode raises questions on Glencore motives for allegedly upending a seemingly innocent hospital contract so aggressively.
A extra rapid concern for Glencore is nevertheless the menace posed by the revival of the Hagens’ case to its historic settlement for its abundance of previous sins.
The corporate has agreed to 2 separate settlements within the US – a $700 million one for bribery and corruption in addition to a $385 million one for manipulating gasoline costs. These are separate from settlements within the UK and elsewhere.
The corruption settlement with the US was considerably finalised in Could this 12 months however the date for closing sentencing has been repeatedly postponed.
The US has been haggling with Swiss authorities to create a compliance monitoring scheme to maintain Glencore sincere in future. The mining big is predicated in Geneva. The present estimate is that the Swiss will make a dedication in late January 2023.
The Hagens have now thrown an extra spanner within the works with their $50 million declare, a big addition to the $700 million corruption settlement and doubtlessly an instance for others to comply with.
The Hagens base their declare on Glencore’s personal $16 million estimate of what paying the bribe saved the multi-national by swinging the 2010 case, plus claims for the lack of their enterprise and authorized bills.
Glencore, in its personal responding courtroom papers, readily admits that it owes the Hagens restitution – however argues that the suitable quantity is extra within the area of $10 million.
Docs vs medical doctors
Crusader Well being had been appointed by the earlier homeowners of two copper mines wherein Glencore and Gertler, by KCC, acquired controlling pursuits in 2009.
Shortly afterwards, Glencore introduced in Hattingh who already ran hospital operations at one other Glencore mine within the DRC known as Mutanda.
Ian Hagen, who was primarily based in Australia along with his spouse on the time, alleged in his courtroom papers:
“Crusader DRC medical employees, who had been working with the Medical Supervisor [Hattingh], reported to me that his medical data and competence had been suspect and ‘at finest on the extent of a paramedic’. I and my employees started conducting diligence to confirm the Medical Supervisor’s medical credentials.”
Hattingh now heads an NGO known as Paediatric Care Africa. On its web site he claims a medical diploma and PhD in neuroscience after research carried out within the US and Taiwan, specialising in foetal alcohol syndrome and associated issues.
He informed amaBhungane, “My understanding is that the Crusaders’ companies had been discontinued as each a monetary resolution and a requirement by the DRC authorities to provide the mine employees at KCC with a Hospital, as that’s what I used to be informed on the time by Glencore. The remainder of the politics I by no means received concerned in.”
Hattingh was employed by Glencore between 2008 and 2013 to construct 4 hospitals, together with these the Hagens had been initially meant to construct.
He then opened one other hospital for the Gertler Household Basis, Dan Gertler’s philanthropic outfit.
He informed us, “The Gertler household basis in Kinshasha paid my wage and paid the preliminary start-up value to open the Kisangani Hospital…I’ve met Dan Gertler on quite a few events on the Gertler basis places of work in Kinshasha. He was my employer, so sure, I do know him.”
The Hagens assert that questioning Hattingh’s appointment sparked a marketing campaign of harassment throughout which “a senior KCC government informed the Hagens that if they didn’t flip a blind eye to this subject [Hattingh’s expertise], they’d by no means work within the DRC once more”.
They state, “Glencore concedes that it acted in unhealthy religion and terminated Crusader DRC’s contracts, not for any professional enterprise cause, however as a result of the Hagens had been stirring up hassle by investigating the Medical Supervisor… thereby jeopardising Glencore’s relationship with the DRC Companion.”
“A veritable journey by the felony code”
It isn’t solely clear from the Hagens’ courtroom papers why Hattingh allegedly discovered such favour.
What adopted is, nevertheless, extra readily comprehensible.
When Crusader received canned after which got here again with a courtroom problem, it was taken severely sufficient to warrant bribing the choose to safe a beneficial end result primarily based on a technicality somewhat than the deserves of the declare.
Nonetheless, the Crusader declare, then price round $10 million, appears small change for Glencore.
Hagen theorises that the declare needed to be quashed and saved quiet as a result of it coincided with a fragile deal involving a $110 million mortgage being negotiated with world asset administration agency Och-Ziff.
Och-Ziff (now renamed Sculptor Capital Administration) beforehand signed a settlement (much like the Glencore one) associated to bribes paid in African international locations.
Regardless of the cause for Glencore’s resolution to freeze out the Hagens, they’re adamant the corporate should make full restitution.
“For greater than a decade, Glencore has engaged in felony and corrupt actions directed at Crusader DRC and the Hagens. Glencore’s conduct has been a veritable journey by the felony code—bribes, corruption, intimidation, and threats of bodily violence which precipitated Crusader DRC to depart the nation—all of which crippled the Hagens’ enterprise and denied them their rightful restoration.”
It’s sure that Glencore can pay – the query is simply how a lot.
The larger query raised by the bigger Glencore settlement is whether or not the online of accountability will prolong to its former executives – and to the “DRC Companion”.
AmaBhungane is a nonprofit centre for investigative journalism. We co-publish our investigations, that are free to entry, to information websites like News24. For extra, go to us on www.amaB.org.