Glencore Congo deals are said to be part of latest offshore leak

LONDON – Glencore could face renewed scrutiny of its business in the Democratic Republic of Congo after confidential information was released in the data breach of a major offshore law firm, according to people familiar with the matter.

The documents relate to Glencore’s acquisition of Katanga Mining, which runs copper and cobalt mines in Congo, and dealings with Israeli billionaire Dan Gertler, said the people, asking not to be identified because the records haven’t been made public.

Appleby, a Bermuda-based provider of offshore legal services, said on Tuesday that it suffered a “data security incident” last year and reporters from the International Consortium of Investigative Journalists and other media groups had recently been asking questions about leaked information.

"Appleby has thoroughly and vigorously investigated the allegations and we are satisfied that there is no evidence of any wrongdoing," the firm said in a statement posted on its website.

Appleby was told by the ICIJ that the journalists are investigating documents that detail Appleby’s business with a wide range of clients, the law firm said in the statement. Appleby has both corporate and high net-worth individuals as clients, according to its web site.

The journalist group is known for publishing the Panama Papers, a trove of files from law firm Mossack Fonseca made public in 2016 that exposed offshore companies and hidden financial dealings.

CONGO COPPER
While Bloomberg News hasn’t seen the confidential Appleby documents, public records show Appleby lawyers advised Katanga on various transactions. Those include the merger with Gertler’s Nikanor in 2007, and rights offers and loan agreements with Glencore between 2007 and 2009.

Spokesmen for Glencore, Gertler and the ICIJ declined to comment. Appleby did not respond to a voice message seeking comment.

Glencore, the world’s biggest commodities trader, is a major investor in Congo and has created thousands of jobs, helping the nation become Africa’s top copper producer. However, its business with Gertler, a friend of Congo President Joseph Kabila, has been contentious.

Last year, hedge fund manager Och-Ziff Capital Management agreed to pay US authorities $412-million to settle charges that it participated in a bribery scheme involving Congolese officials. As part of the settlement, Och-Ziff acknowledged that it made a loan in 2010 to its partner in Congo to buy Katanga shares. That partner was Gertler, according to a person familiar with the matter. Glencore wasn’t accused of any wrongdoing.

Glencore’s work with Gertler on the takeover of Katanga has been questioned by Global Witness, a London-based advocacy group. In 2014, it released a report saying Glencore may have channeled funds to Gertler at the expense of other Katanga shareholders. Glencore denied those allegations.

In February, Glencore cut ties with Gertler in a $960-million deal to acquire his stakes in Katanga and Mutanda Mining. Gertler’s company has said it still receives royalties from both projects.