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Thursday
May042017

Federal jury convicts former Guinea mining minister of laundering bribes

A U.S. citizen who served as mining minister of the West African country of Guinea was convicted by a federal jury Wednesday of laundering $8.5 million in bribes he took from Chinese companies in exchange for valuable mining rights.

Mahmoud Thiam, 50, took bribes from executives of China Sonangol International Ltd. and China International Fund, SA (CIF). 

He was convicted of of one count of dealing in criminally derived property and one count of money laundering.

The jury reached its verdict yesterday after deliberating five hours. The trial lasted a week.

Thiam, a resident of New York, was Guinea's minister of mines from early 2009 until late 2010.

He came to the United States when he was seven. His father, a banker, had been tortured and killed by Guinea's dictator.

Thiam was granted U.S. citizenship and eventually studied at Cornell University. He worked for Merrill Lynch and later for UBS in its New York office.

He left to serve in the Guinea government as the Minister of Mines and Geology in 2009 and 2010 before returning to New York.

Thiam went to Hong Kong in 2009 and opened a bank account there to launder bribe money. China Sonangol and CIF paid $8.5 to the account.

He used some of the money to buy a $3.75 million property in Dutchess County, New York and to pay for private schools for his children, the DOJ said.

China Sonangol, CIF, and their subsidiaries signed a series of agreements with Guinea that gave them valuable mining rights.

"Thiam influenced the Guinean government’s decision to enter into those agreements while serving as Guinea’s Minister of Mines and Geology from 2009 to 2010," the DOJ said in a release Thursday.

To hide the bribes, the DOJ said, Thiam told banks in Hong Kong and the United States that he worked as a consultant. He also said the money was "income from the sale of land which he earned before he was a minister," the DOJ said.

During his trial, Thiam said he lied to the banks not to conceal bribes but to avoid being designated as a PEP -- a "politically exposed person."

"My primary concern was to be treated as Mahmoud Thiam, private citizen," he testified.

Banks are sometimes reluctant to deal with PEPs because of money-laundering concerns.

China Sonangol -- a Chinese joint venture with Angola's state oil company -- and CIF landed "exclusive and valuable rights to conduct business operations in a broad range of sectors of the Guinean economy, including mining, according to the trial evidence," the DOJ said.

Thiam has been in custody since his arrest in New York in December 2016.

He's scheduled to be sentenced on August 11. He faces up to ten years in prison.

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Richard L. Cassin is the publisher and editor of the FCPA Blog.