Authorized & Normal sues Glencore in newest corruption fallout

Glencore has been hit with a contemporary lawsuit from a giant asset supervisor over alleged investor losses, prompted by the conviction for bribery of the commodities group final yr.

Within the newest authorized fallout from the corruption scandal, Authorized & Normal filed a declare in opposition to the mining and commodities buying and selling group in London’s Excessive Court docket final week.

The case considerations alleged losses to shareholders ensuing from Glencore’s statements to the market, in accordance with folks aware of the matter, in mild of misconduct revealed as a part of corruption probes.

The declare has been formally launched however the firm has not but filed authorized paperwork setting out its allegations.

Glencore final yr admitted multiple counts of bribery and market manipulation that came about for simply over a decade till 2018 throughout Africa and Latin America. The case adopted investigations by the US, UK and Brazilian authorities.

The contemporary declare ratchets up strain on the group, which has already been sued by greater than a dozen international traders, together with sovereign wealth funds Mubadala and the Worldwide Petroleum Funding Firm. each based mostly in Abu Dhabi, the Kuwait Funding Authority, and Norway’s Norges Financial institution.

L&G, which controls round £1.3tn in belongings beneath administration, is bringing the brand new case on behalf of pension, funding and insurance coverage clients. It considerations disclosures that the corporate made to the market in 2011 and 2013, in accordance with folks aware of the matter.

These had been the years through which Glencore, respectively, floated on the inventory market in London and accomplished the takeover of Xstrata that diversified the buying and selling home into mining and producing the commodities that it sells.

The contemporary declare is anticipated to cowl comparable floor to that lodged final yr, together with by Abrdn and HSBC, in addition to Phoenix Life, Customary Life, Reassure and British Airways Pension Trustees.

Metropolis legislation companies together with Stewarts, Quinn Emanuel Urquhart & Sullivan and Bryan Cave Leighton Paisner have all been drafted in for claims, and BCLP associate Ravi Nayer is known to have been employed by L&G.

Glencore and L&G declined to remark. On the time of the conviction, Glencore mentioned it had strengthened compliance procedures lately and that it was “not the corporate it was”.

Glencore was ordered to pay £276mn by a UK choose final yr after pleading responsible to seven counts of bribery in nations corresponding to Nigeria and Cameroon between 2011 and 2016, following a Severe Fraud Workplace probe.

In complete, Glencore put aside $1.5bn to pay fines for bribery convictions final yr within the US, UK and Brazil. Related investigations stay beneath manner in Switzerland and the Netherlands. The US Division of Justice has mentioned it could nonetheless pursue people for its function within the bribery instances.

Glencore reported report full-year earnings of $34bn on Wednesday, powered by excessive costs for coal, a commodity the corporate has caught by whilst different mining teams have divested belongings producing the fossil gas.

The bribery convictions have finished little to carry again Glencore’s share value. The robust efficiency of its coal division helped energy its shares firstly of this yr to a report excessive and has made the inventory one of many best-performing for a lot of fund managers.