Real Assets
Anti-corruption investigators who have spent years probing a deal between an Israeli diamond dealer and the West African country of Guinea hope the Panama Papers will shed light on one of the most lucrative mining contracts in Africa’s history. When Israeli tycoon Beny Steinmetz signed a deal for a 50% stake in one of the world’s richest mineral deposits, he expected it would rake in the kind of money that had propelled him to the top of global rich lists. As a prolific buyer of De Beers’ diamonds, and a supplier to the likes of Tiffany & Co., Steinmetz was used to maneuvering the murky world of mining. The Simandou mine, filled with iron ore and located in a remote forest in West Africa’s Guinea, was supposed to be no different. But Steinmetz’s investment, made in 2008, sucked him into a scandal of staggering proportions. The first cracks appeared when a new government came to power in 2010 and began investigating mining contracts. Since then, there have been raids on offices linked to the billionaire in Switzerland, alleged associates nabbed by FBI stings, purported allies turned informants, and a lengthy and bitter public battle with the current government of Guinea, where an independent inquiry concluded that he acquired the stake through corruption under former dictator Lansana Conté. Steinmetz’s company, BSG Resources Ltd. (BSGR), denies paying any bribes and all other charges against them. The scandal has gone on for years now as investigators build their case, attempting to show that BSGR used a shell company to bribe the wife of the country’s former dictator in exchange for their stake in a mine valued at $4 billion — for which they paid nothing. That Mamadie Touré took bribes isn’t in question. But there was always one piece missing — how do you go about proving the bribes came from BGSR? Now that may be about to change.