KINSHASA (Reuters) – Congolese prosecutors are investigating a 200-million-euro ($222 million) line of credit issued to state mining company Gecamines by a company owned by Israeli billionaire Dan Gertler, who is under U.S. sanctions, Gecamines said on Monday.
Two sources at Democratic Republic of Congo’s prosecutor’s office and two at the presidency, speaking on condition of anonymity, told Reuters the investigation was focused on possible money laundering and fraud related to a loan issued in October 2017 by Gertler’s Fleurette Mumi, which has since been renamed Ventora Development.
In a statement, Gecamines interim director-general Jacques Kamenga confirmed that a company official was questioned by prosecutors last week, without naming the person. Kamenga denied any wrongdoing and said Gecamines provided investigators with all requested documents.
Gertler’s spokesperson referred Reuters to a statement by Ventora Development, which said it issued the loan and was simply trying to recover money it was owed by Gecamines.
Kamenga could not be immediately reached by Reuters for comment.
Both Gecamines and Gertler have faced corruption allegations from watchdog groups over the past decade related to the sale of mining assets in Congo, which, despite copious mineral resources, is one of the world’s poorest countries.
According to a 2013 report by the Africa Progress Panel, which was headed by former U.N. Secretary-General Kofi Annan, Congo lost out on $1.36 billion in potential revenue between 2010 and 2012 in five mining deals involving Gecamines and Gertler.
The U.S. Treasury sanctioned Gertler and more than 30 of his businesses in December 2017 and June 2018, accusing him of using his friendship with former Congo President Joseph Kabila to secure sweetheart mining deals.
Gertler, Kabila and Gecamines have denied all allegations of impropriety.
Gecamines’ Kamenga said the company ended up borrowing 128 million euros from Fleurette Mumi’s line of credit in October 2017, two months before the U.S. imposed sanctions. Kamenga said Gecamines used the money to pay tax advances in Congo.
Gertler’s Amsterdam-based Fleurette Group was a joint venture partner of Gecamines in one Congo mine and said in 2014 that it lent Gecamines $196 million in 2013 to purchase two other copper mines.
Because of the U.S. sanctions against Gertler, Gecamines was advised by its lawyers not to reimburse the loan, Kamenga said in his statement on Monday.
Ventora Development sued Gecamines in October for repayment of the loan and a Congolese court ordered Gecamines last month to pay nearly 152 million euros of the loan principal and interest, Kamenga and Ventora said. Gecamines has appealed the ruling and not yet made any payment, Kamenga added.
On Dec. 17, Kamenga and another Gecamines official were prevented by immigration authorities from boarding a flight in the Congolese capital Kinshasa and told they were banned from traveling, Kamenga said.
Two days later, they were summoned by the prosecutor’s office in Kinshasa, where a Gecamines official was questioned about the loan, Kamenga said.
The four sources at the prosecutor’s office and the presidency said that the chairman of the Gecamines board, Albert Yuma, had been also banned from leaving the country.
Yuma is a close ally of Kabila, who left office in January after 18 years as president. Reached for comment, Yuma referred Reuters to Kamenga’s statement.