https://www.miningweekly.com
Business|Coal|Mining|rail
Business|Coal|Mining|rail
business|coal|mining|rail

US judge rejects SEC bid to expand Rio Tinto fraud lawsuit on Mozambique coal business

4th March 2021

By: Reuters

  

Font size: - +

A US judge on Wednesday quashed a bid to widen the scope of a civil lawsuit by the US Securities and Exchange Commission that accused miner Rio Tinto of fraud at its Mozambican coal business, a court filing showed.

The SEC filed a complaint against Rio in 2017 with allegations that it had fraudulently concealed the decline in value of the business.

Rio had acquired Riversdale mining for $3.7-billion in 2011, on the premise it would be able to barge 30-million tonnes of coal per year down the Zambezi river, and rail a further 12-million to 15-million tonnes of coal per year to port.

But it failed to secure government approvals, and discovered the resource was lower than expected, still raising more than $5-billion in 2012 before impairing the assets as coal prices fell the following year, when Chief Executive Tom Albanese departed.

Defendants Rio Tinto Ltd, Rio Tinto Plc, Albanese, and former CFO Guy Elliott had argued that the studies were not complete at the time the capital was raised.

In a 2019 ruling, US District Judge Analisa Torres in New York said the regulator may pursue some claims in its October 2017 lawsuit but narrowed the main fraud claim against Rio Tinto and Albanese to focus on the former CEO’s statements about Mozambique growth prospects.

The SEC argued that some of the dismissed claims should be restored, in light of a subsequent US Supreme Court decision in an unrelated case, but that bid was knocked back on Wednesday.

The surviving SEC case includes a claim that Albanese intended to mislead investors in 2012 by describing the Moatize Basin, where RTCM was located, as a world-class basin coal deposit and long-term growth opportunity.

The Australian Securities and Investments Commission brought its own civil claims against Rio Tinto, Albanese and Elliott.

The case is SEC v Rio Tinto Plc et al, US District Court, Southern District of New York, No. 17-07994.

Edited by Reuters

Comments

Showroom

Booyco Electronics
Booyco Electronics

Booyco Electronics, South African pioneer of Proximity Detection Systems, offers safety solutions for underground and surface mining, quarrying,...

VISIT SHOWROOM 
SABAT
SABAT

From batteries for boats and jet skis, to batteries for cars and quad bikes, SABAT Batteries has positioned itself as the lifestyle battery of...

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Photo of Martin Creamer
On-The-Air (15/03/2024)
15th March 2024 By: Martin Creamer
Gold, hydrogen, mining boost make headlines
Gold, hydrogen, mining boost make headlines
15th March 2024
Magazine round up | 15 March 2024
Magazine round up | 15 March 2024
15th March 2024

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







sq:0.108 0.142s - 91pq - 2rq
Subscribe Now