Dividends and Mining tycoon gets prison time, heavy fine in Swiss bribery trial

When you invest, you expect that the investments will be honest or above board and you will not lose money. You expect and understand why there is some greasing of the wheels, it is not over the top. And if someone does get caught, the person who goes to jail or loses assets is someone who lives the lifestyle of a very wealthy person or actually is a wealthy person.

The above does not happen often but there are exceptions. In an article by Stephanie Nebehay of Reuters, a mining tycoon was convicted in a Swiss court. The mining tycoon is Beny Steinmetz who runs the Ben Seinmetz Group Resources (BSGR) which employs over 100,000 people in the mining industry. Mr. Steinmetz is a citizen of Israel. He was found guilty of corruption and forgery and sentenced to jail and a fine of 50 million Swiss francs ($56.48 million).

In the country of Guinea, the BSGR was going to open an iron ore mine in the Simandou mountains of Guinea. The BSGR group offered a $10 million bride to gain the exploration permits and forged documents through a series of shell companies to try to cover it up.

In the court, Justice Banna said that Mr. Steinmetz had made an immediate profit from the mining rights and not a cent went to the government of Guinea.

Bernhard Maier a London attorney representing mining companies said, the case demonstrates a world of increasing transparency and scrutiny, as a result of technology and the internet, there is more accountability.

Mr. Steinmetz’s lawyer Marc Bonnant said he would launch an appeal.

Linking to dividend paying stocks, the tools that help companies determine customer preferences are also the tools that can be used to keep companies more accountable. It is best to buy into a company which has reasonably high ethics in the first place, because then you do not have to worry about it the first place. Being honest and ethical helps you sleep at night and in the long term makes you wealthier.

There are more questions than answers, till the next time – to raising questions.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s