This one has intrigued me for a very long time.
Way back in 2016, while thanking
the Financial Times' Henry Sanderson for a story that preceded a
five-fold move in cobalt I asked what the renamed ERG formerly Eurasian
National Resources Corporation (ENRC) was up to:
Big kudos to the FT's Henry Sanderson for recognizing one hell of a story and a small request for the Financial Times: Can you tell us what the old ENRC is up to these days?
In 2018 I repeated the plea, this time to Neil Hume, the FT's natural resources editor.
From The Guardian, September 12, 2024:
It began as a routine investigation into a multinational called ENRC. It became a decade-long saga that has rocked the UK’s financial crime agency. Now new documents illuminate a case that has rewritten UK law and is set to end with a huge bill handed to taxpayers
1: A body, a mine, a mystery
Clement Jackson was at home by the South African coast, tending to the meat on his beloved braai, when the call about the body came. He found contentment at the barbecue. Bald, with craggy features and prominent ears, he liked to impart the secrets of a succulent lamb shank or the perfect T-bone to his children. They were grown up, with children of their own, but even as he approached 60, Jackson was not ready to yield the tongs to them just yet.
Since heart trouble brought an early end to his police career 20 years earlier, Jackson had worked as a private detective. Born in 1959 – just as Nelson Mandela was going on trial for treason – he’d followed his father into the force. Jackson loved the sleuthing, assembling a jigsaw of evidence. Specialising in mining, he made his name in the late 1980s, when he cracked the smuggling rings that rich South Africans were using to squirrel bullion and precious stones abroad during the final years of apartheid.
The mining industry was an engine of the bribery, violence and inequality that continued to blight South Africa even after Mandela took power. So once Jackson began to take on private clients, there was plenty of detective work to do. In 2016, one of his industry contacts referred a new client to him. Jackson stepped away from the braai to take the call.
The American voice on the phone belonged to a mining investor. He wanted Jackson to investigate the mysterious death of a geologist who had worked on his South African ventures. The geologist’s name was André Bekker. The previous night, 28 October 2016, Bekker’s white Audi Quattro had been set alight on a suburban street in Johannesburg, South Africa’s commercial capital. When the flames burned out, Bekker’s charred body lay slumped against the back door.
Jackson agreed to take the case. A few days later, he flew to Johannesburg. He began by considering whether Bekker’s death could have been suicide. The fire appeared to have started at the front of the car. Could Bekker have ignited the blaze from the back seat, perhaps with a bullet? Next to impossible, Jackson was told when he visited an Audi dealership. The car had burned so hot that it seemed someone must have doused it with an accelerant. Jackson, as I reported years later, grew convinced this was a murder.
Bekker, Jackson learned, had been going through a divorce and his family suspected he sometimes paid for sex. But he found nothing to suggest that those close to Bekker wanted him dead. Each new lead hit a wall. Then one day in December 2016, Jackson arranged to meet a sensitive source he’d known for years. The source produced a piece of paper and drew a diagram of a multinational mining corporation Jackson had never heard of: ENRC.
With mines from Kazakhstan to Congo, ENRC – Eurasian Natural Resources Corporation – was once one of the most valuable companies on the London Stock Exchange, worth £20bn at its peak just a few years earlier. In 2007, when it floated, captains of British business, two of them with knighthoods, were appointed to ENRC’s board to steward this new giant of UK commerce. Soon, though, the business pages were carrying tales of boardroom ructions. The oligarch founders, three billionaires from the former Soviet Union known as the Trio, were fighting the company’s directors for control of this vast mining empire. The scandal deepened when allegations emerged that the prized mines ENRC had taken over in Africa were won with bribes.
Jackson’s source told him about another of ENRC’s African deals. In 2011, it had bought a manganese prospect in South Africa called Kongoni. The price was $295m. Which was odd. Because Kongoni was so remote and hard to mine that it was worth nothing like as much. That, at least, had been the view of an expert geologist who had examined it: André Bekker.
“This thing,” Jackson said to himself as he heard the dead man’s name, “it’s much deeper than we thought.”
Jackson worked his mining contacts to find out everything he could about the Kongoni deal. He came to think it was a fraud. Less than two years after the deal, the value of Kongoni recorded in ENRC’s accounts was not $295m – but zero. The company blamed a fall in the manganese price, suggesting the asset’s value might go up again. But Bekker had told others in the industry that Kongoni had never been worth $295m. Not even half as much. The geology just wasn’t good enough.
And there was another mystery. Who had ENRC bought Kongoni from? Beyond the names of some obscure offshore companies, the accounts did not say who had received ENRC’s $295m. Though he didn’t have definitive proof, Jackson suspected this was a scheme to siphon that money out of a British PLC....
....MUCH MORE
