Rio Tinto’s calamitous $3.7bn Mozambique coal deal still haunts them
Melbourne — Rio Tinto Group’s calamitous $3.7bn coal deal in Mozambique keeps coming back to haunt the world’s second-biggest miner, three years after it unloaded the mine. US authorities filed fraud charges against London-based Rio, former CEO, Tom Albanese, and former chief financial officer, Guy Elliott, claiming they inflated the value of the coal assets acquired in 2011. The unit was sold for $50m in 2014 following impairments of about $2.9bn in 2013 and $470m a year later. Rio concealed setbacks at the project and Albanese publicly reinforced a "false positive outlook" for the asset, according to a Securities and Exchange Commission (SEC) complaint filed in federal court in New York. Executives told Albanese and Elliott that by May 2012 the Mozambique unit was likely "worth negative $680m", the SEC said. "Rio Tinto intends to vigorously defend itself against these allegations," the company said in an e-mailed statement on the SEC charges. Albanese, Rio’s CEO between 2007 and 2...
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