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Monday
Dec012014

Feds seize Florida property linked to alleged BSG Guinea bribes

Image courtesy of Global Witness via YouTubeA federal court in Florida last week granted a request by prosecutors to seize three properties and various restaurant equipment from Mamadie Touré.

Touré, left, is the widow of Lansana Conté, a dictator who ruled the west African country of Guinea for 24 years before he died in 2008. She moved to Florida after her husband's death.

Prosecutors alleged in the forfeiture action that Touré received bribes of $5.3 million to help a mining company win iron-ore rights in Guinea, in mining areas known as Simandou and Zogota.

The company involved wasn't named in the forfeiture action.

BSG Resources, controlled by Israeli billionaire Beny Steinmetz, held the iron ore rights in Simnandou and Zogota in a joint venture with Brazilian miner Vale.

U.S. prosecutors launched a grand jury investigation into BSGR’s deals in Guinea in early 2013. Touré became a co-operating witness.

In April 2013, she wore an FBI wire in meetings at the Jacksonville airport with Frederic Cilins, a French national who worked as an intermediary for BSGR in Guinea.

Cilins was recorded offering her millions of dollars if she agreed to lie to prosecutors and destroy contracts that purported to lay out the bribery scheme.

Cilins pleaded guilty in March to obstructing a federal criminal investigation into whether BSG Resources paid bribes to win mining rights in Guinea. In July he was sentenced to two years in prison.

In April this year, a Guinea government inquiry concluded that BSG obtained concessions to the Simandou mining area through corrupt practices.

Based on the findings, Guinea revoked mining licenses for iron ore concessions held by BSGR and a joint venture partner, Brazilian miner Vale SA.

Vale hasn't been implicated in the alleged bribery scheme.

BSGR has denied all wrongdoing and accused Touré of creating fake contracts and trying to extort money from the company.

In April, BSGR said in a statement that Guinean president Alpha Conde wanted to take back the mining rights and give them to political cronies.

Global Witness has alleged that BSGR paid nothing for its rights to Simandou and sold 51% of its stake to Vale in 2010 for $2.5 billion.

Of that amount, Global Witness said, $500 million was paid immediately, with the remainder to be paid in stages.

"Even allowing for the $160 million that BSGR says it invested in Simandou and a neighboring concession, the profit was immense," Global Witness said. "The Guinean government’s entire annual budget in 2010 amounted to just $1.2 billion."

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Richard L. Cassin is the publisher and editor of the FCPA Blog. He can be contacted here.