- The Serious Fraud Office is investigating Glencore over suspected bribery.
- The £30bn world’s largest commodity company says it will cooperate with the investigators.
- Following the news, its share price dropped by 9% to record a new three-year low.
The Serious Fraud Office (SFO) of the UK has officially launched an investigation into alleged bribery offense by Glencore, the world’s largest commodity trader.
In a statement, the SFO said: “We are investigating suspicions of bribery in the conduct of business by the Glencore group of companies, its officials, employees, agents, and associated persons”.
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“Glencore has been notified today that the Serious Fraud Office has opened an investigation into suspicions of bribery in the conduct of business of the Glencore group,” the company’s statement on the matter read in part.
Glencore is said to be worth about £30bn spread across its mining and commodities lines of business.
The firm, which trades on the London Stock Exchange but is headquartered in Baar, Switzerland, agreed to cooperate with the UK’s fraud investigative unit.
As expected, when the news of the probe hit the market, its share price plummeted, slashing about 9% off its market value, to settle at a three-year low.
Glencore trades oil, sugar, cotton, among several other commodities and is the world’s largest in its line of business. It is also heavily invested in hard commodities such as gold, silver, platinum, nickel, iron, and aluminium, and boasts of operations in more than 50 countries.
But this is not the only investigation involving the commodities company; about a year ago, the US Department of Justice launched investigations against Glencore over suspected money laundering and corruption in Nigeria, Venezuela and the Democratic Republic of Congo (DRC), Africa’s largest copper producer.
But everyone saw this new investigation coming, considering a May report by Bloomberg that highlighted Glencore’s vexed dealings with Israeli billionaire Dan Gertler and the leader of DRC. The report further stated that the SFO was preparing to open a formal bribery investigation into the company.
Gertler, whose notoriety in the DRC spans nearly two decades, is believed to have played the unofficial “gatekeeper” role to the country’s natural resources deals. The claims are in addition to his decades-long closely-guarded controversial friendship with DRC’s former head of state, Joseph Kabila.
Glencore is adversely mentioned in the controversial dealings of Mr. Gertler and other mining and commodities-dependent states informing the SFO’s decision to formally launch an investigation into its dealings. So while Glencore has carved a named in the mining and commodities industry since 1974 when it was founded, it’s safe to say that it has also developed a controversial reputation of its own.