On Dec. 20, U.S. President Donald Trump signed an executive order under the year-old Global Magnitsky Human Rights Accountability Act and related acts to block the property of 13 “malign actors,” plus 39 affiliated individuals and entities accused of “serious human rights abuse or corruption.”
One miner is on the list: Israeli diamond and copper mogul Dan Gertler, 44, who has wheeled and dealed for years in the murky world at the cross section of business and politics in the Democratic Republic of the Congo (DRC).
Trump stated in his order that “serious human rights abuse and corruption around the world constitute an unusual and extraordinary threat to the national security, foreign policy and economy of the U.S., and I hereby declare a national emergency to deal with that threat.”
Treasury Secretary Steven Mnuchin said the U.S. is taking a “strong stand against human rights abuse and corruption globally by shutting these bad actors out of the U.S. financial system. Treasury is freezing their assets and publicly denouncing the egregious acts they’ve committed, sending a message that there is a steep price to pay for their misdeeds.”
By being on this list, any of Gertler’s property and interests in property within U.S. jurisdiction would now be blocked, and U.S. persons are prohibited from engaging in transactions with him.
The U.S Treasury Department made the following description of Gertler and his activities in the DRC:
“Gertler is an international businessman and billionaire who has amassed his fortune through hundreds of millions of dollars’ worth of opaque and corrupt mining and oil deals in the DRC. Gertler has used his close friendship with DRC President Joseph Kabila to act as a middleman for mining asset sales in the DRC, requiring some multinational companies to go through Gertler to do business with the Congolese state. As a result, between 2010 and 2012 alone, the DRC reportedly lost over US$1.36 billion in revenues from the underpricing of mining assets that were sold to offshore companies linked to Gertler. The failure of the DRC to publish the full details of one of the sales prompted the International Monetary Fund to halt loans to the DRC totalling US$225 million. In 2013, Gertler sold to the DRC government for US$150 million the rights to an oil block that Gertler purchased from the government for just $500,000, a loss of US$149.5 million in potential revenue. Gertler has acted for or on behalf of Kabila, helping Kabila organize offshore leasing companies.”
Gertler-linked businesses that are also sanctioned by this action are: Africada Airways, Kanilai Group International, Kanilai Worni Family Farms, Royal Africa Capital Holdings, Africada Financial Service & Bureau de Change, Africada Micro-Finance, Africada Insurance Co., Kora Media Corp., Atlantic Pelican Co., Palm Grove Africa Dev’t Corp., Patriot Insurance Brokers Co. and Royal Africa Securities Brokerage Co.
An unnamed figure that seemed to match Gertler’s description popped up in settlement documents filed by U.S. authorities in September relating to a scandal involving New York hedge fund Och-Ziff, which alleged an “Israeli businessman” had paid bribes to Kabila to obtain special access to mining rights in the DRC.
In March, London-listed mining and commodities giant Glencore largely parted ways with Gertler after an association dating to at least 2009 by paying Gertler US$543 million for his share of the jointly owned Mutanda and Katanga copper-cobalt mines in the DRC.
Gertler had kept royalty payments from Kamoto Mine under the deal, but Glencore acknowledges that it must now halt these royalty payments under the new Magnitsky Act sanctions.
Some analysts argue that cutting funds to Gertler will result in fewer dollars flowing to Joseph Kabila and further pressure the leader — who has been in power since the assassination of his father Laurent-Désiré Kabila in 2001 — to hold long overdue national elections in the DRC that were to have been held in December 2016, but never took place.
Gertler’s dealing with the Kabilas began at the turn of the century, when Gertler is said to have obtained exclusive rights to trade in DRC diamonds in return for weapon deals with Laurent Kabila, who was consolidating power after overthrowing Mobutu Sese Seko in 1997.
Gertler has denied making bribes in the DRC, and has suggested his efforts to bring natural resource investment to the DRC deserve a Nobel Peace Prize.
Doesn’t make Canadian security regulators and law enforcement look very good, does it, when Glencore has flipped half the Board of Katanga and the US has taken decisive action, while the OSC is still “investigating” and the RCMP haven’t even gotten that far? We’re told that fraud and corruption “will not be tolerated” in Canada, but it’s increasingly hard to avoid the conclusion that they are tolerated if not actually encouraged by lax regulation and enforcement.