Gold Fields Says It Acted Lawfully in Ownership DealKevin Crowley
Gold Fields Ltd. said it acted lawfully in transferring shares to a South African black-owned group in 2010 as the country’s Mail & Guardian newspaper said today the mining company may have violated anti-corruption laws.
“The board has acted deliberately and appropriately and in full compliance with the law,” Chairman Cheryl Carolus said in a statement. “The board of Gold Fields received information from a range of sources and advice from a number of legal and other advisers, which collectively informed its decisions.”
In August 2010, Gold Fields agreed to issue 600,000 shares to a black-owned group and allowed it to buy 10 percent of the South Deep mine. Local law requires mining companies to sell or cede at least 26 percent of their operations to black citizens. In 2012, the company denied a M-Net Television report that the deal benefited people who helped it win a permit for the mine.
Carolus’s comments respond to an article in the Mail & Guardian alleging that Gold Fields either paid people to help influence the government, or willfully ignored evidence of corruption. The newspaper cited a report by U.S. law firm Paul, Weiss, Rifkind, Wharton & Garrison LLP.
“We stand by our story,” said Stefaans Brummer, managing director of the M&G center for investigative journalism, which wrote the article.
Gold Fields is under investigation by the U.S. Securities and Exchange Commission over the transaction. The Mail & Guardian said the company suppressed the findings of the New York law firm, which was commissioned to probe the deal.
The law firm said Chief Executive Officer Nick Holland and company attorney Michael Fleischer hid critical information from the board and investigators, the Mail & Guardian reported.
Sven Lunsche, a spokesman for Johannesburg-based Gold Fields, declined to comment beyond the statement from Carolus. A call outside normal office hours to Lisa Green, a spokeswoman for the law firm, wasn’t returned.