African Barrick Gold denies allegations of land deal bribes

19 June 2014 (Last Updated June 19th, 2014 18:30)

Tanzania-based subsidiary of Canada's Barrick Gold, African Barrick Gold (ABG), has denied allegations of making illegal payments to Tanzanian Government officials for land purchases near its North Mara gold mine last year.

Tanzania-based subsidiary of Canada's Barrick Gold, African Barrick Gold (ABG), has denied allegations of making illegal payments to Tanzanian Government officials for land purchases near its North Mara gold mine last year.

The company has issued a statement to this effect, in response to a Wall Street Journal article that accused the gold miner of paying $400,000 in cash to bribe government officials and consultants for clearing the deal.

"Both African Barrick Gold and Barrick Gold Corporation are committed to ethical and transparent business practices in compliance with the law," ABG said in the statement.

"Cash is often the only viable method of payment because in many regions of the country, banking infrastructure and services are extremely limited, or sometimes not available at all."

The Wall Street Journal had reported allegations based on company invoices and copies of cheques it claimed to have seen.

The newspaper quoted an anonymous source as saying that, according to an email sent to the company last year, the payments were bribes to officials who were in positions to influence ABG's business interests.

Wall Street Journal cited company documents saying that the Tanzanian Government's task force head, Adam Yusuf, and district land officer, Jerry Minja, had received a part of the cash.

ABG said in its statement that to determine the fair value of land the company wishes to purchase from local land owners, it regularly engages with local and national government officials in Tanzania, under the Lands Task Force agreement authorised by the Tanzanian Government.

"Cash is often the only viable method of payment because in many regions of the country, banking infrastructure and services are extremely limited, or sometimes not available at all," the statement added.

The company also said that their payments were verified by a US law firm, which found that they were in accordance with Tanzanian, US and UK law.

In September 2013, Jaco Maritz, who was serving as interim chief financial officer at ABG, had raised concerns about the cash payments, according to the newspaper.

Last year, the company started a new process to buy land near the North Mara mine after its earlier efforts were hit by unreliable land records.

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