The Swiss special prosecutor in the bribery case against Israeli billionaire Beny Steinmetz secretly visited Israel twice over the past two years.
Geneva prosecutor Claudio Mascotto has led the global investigation against Steinmetz and two associates over the alleged payment of bribes linked to the allocation of mining licenses in Guinea between 2005 and 2010, Haaretz has learned. The investigation is being conducted by authorities in Switzerland, Israel, the United States and Guinea.
Steinmetz, who got his start in the diamond business, and his associates are accused of allegedly "having promised in 2005 and then paid or had bribes paid to one of the wives of former Guinean President Lansana Conte, to have mining rights in Guinea's Simandou region allocated to Beny Steinmetz Group Resources (BSGR),” announced Moscotto in August, when he decided to charge Steinmetz of bribery in Switzerland.
According to Swiss law, the legal process against Steinmetz is supposed to be completely transparent. Nonetheless, Swiss prosecutor Mascotto had paid discreet visits to Israel between March 7 and March 9 in 2017 and between February 3 and February 5 in 2018, along with other officials from the prosecution team in Switzerland. The visits were not coordinated according to the official protocol of the OECD pertaining to communication between countries in corruption cases.
Mascotto, who will leave his present post next month, is a special prosecutor who focuses on corruption cases in Africa. A year ago, charges were dropped in a complex international investigation he led against Teodorin Obiang Nguema, the son of the president of Equatorial Guinea.
The probe against the Israeli mogul
Steinmetz and the two other suspects were indicted in Geneva – where some of the alleged $10 million in bribes had been transited – on charges of alleged corruption of Guinean public officials and forgery. Mascotto is seeking prison terms of two to 10 years. The trial in a criminal court is the city's first major international corruption case under Swiss federal law; it is not set to begin until spring 2020.
Steinmetz denies all the charges and says he will be acquitted in the end. He is accused of paying 2.4 million dollars to the fourth wife of the late Guinean president, who is a key witness in the affair. In return, his company BSGR received the license to mine in the country.
Mascotto opened the investigation against Steinmetz in 2013 in Switzerland. The Swiss entered the picture following a request from the government of Guinea, which claimed Swiss banks had been used to facilitate the payment of the bribes.
Israel got involved in the investigation after the OECD reprimanded it in 2015 for ignoring requests by other member countries and failing to interrogate Steinmetz. The investigation has since been going on simulatenously in two other countries: The United States and Guinea.
Steinmetz claims he never bribed anyone. According to him, when the regime changed in Guinea and a new president was appointed, the latter had harassed him in order to discredit the previous president.
The Israeli businessman had sued the Guinean government and reached a deal with the authorities there, with the mediation of former French President Nicolas Sarkozy. He has since returned to his business operations in Guinea.
Steinmetz has also filed a lawsuit in New York against Jewish billionaire George Soros, claiming that he is behind the investigations against him and that he had applied pressure on the OECD. Soros denied these accusations, and the suit is still underway at the federal court in New York.
Last week BSGR lost an appeal it had filed in the High Court of Justice in London. Steinmetz had challenged a decision in April by the London Court of International Arbitration in favor of Brazilian mining company Vale and awarded Vale $2 billion in compensation for concealing bribery. The five-year-long case revolved around Vale losing the mining rights to the Simandou iron ore deposit in Guinea. BSGR and Vale had formed a joint venture in 2010 to mine but lost the rights after an investigation discovered the alleged bribery by BGSR.
BSGR is in bankruptcy proceedings and is being managed by an external receiver, so it is not clear how much money Vale will receive, or when. BSGR walked away from the giant iron ore project in the West African nation in February.
Development of Simandou – one of the world's biggest iron deposits, containing billions of tons of high-grade ore – was hindered by years of legal wrangling as well as the estimated $23 billion cost of the infrastructure required.
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