MUNGO SOGGOT, Johannesburg | Friday
TRAFIGURA, the trading company embroiled in the South African state oil kickback scandal, has close links with Marc Rich, the alleged fraudster who broke international oil sanctions against apartheid South Africa and who has been controversially pardoned by former United States president Bill Clinton.
Trafiguras South African joint venture, High Beam Trading International (HBTI), is at the centre of the investigation by the Office of the National Director of Public Prosecutions into the payment of $60000 in cash bribes to board members of the Strategic Fuel Fund (SFF). The bribes were allegedly paid as part of a multi-million-dollar oil-trading contract.
High Beams chief, Moses Moloele, was raided last week, with Keith Kunene, the former chair of the Central Energy Fund, who this week resigned all his corporate and public positions.
Trafiguras chief executive, Claude Dauphin, and the other founding directors of Trafigura all formerly worked for Rich. They left in 1993 to form Trafigura, which was in merger talks last year with Marc Rich & Co, a trading company revived by Rich in 1997.
Richs recent pardon by Clinton has led to criminal and congressional investigations, not least because Richs ex-wife, pop songwriter Denise, has been a key contributor to Democratic Party coffers. Rich and his former partner, Pincus Green, fled the US in 1983 before being indicted on charges of tax evasion, racketeering and trading with Iran. Rich then based himself in Switzerland. He was the biggest supplier of oil to apartheid South Africa.
Trafigura has denied that either it or High Beam paid bribes to secure the SFF deal.
The SFFs contract with High Beam/Trafigura involved replacing and transferring oil in the SFFs storage tanks, and gave Trafigura the right to trade on oil markets on the SFFs behalf. While the hedging strategies proposed by Trafigura are considered to have been highly effective and professional, the South African government argues that the remuneration sought by the company is far out of line with industry norms.
The investigation is still continuing, with a parallel civil case taking place in London, where the SFF is seeking to cancel the contract and reclaim $2,9m that has already been paid to Trafigura.
Back in Johannesburg SFF has issued summons against High Beam Trading International and Trafigura to scrap the contract and reclaim the money already paid out.
In the summons, the SFF says the contract is void not only because of procedural irregularities but also because of corrupt practices. It says the defendants, High Beam Trading International and Trafigura, caused … bribe[s] to be paid … to influence the concluding of the agreement.
ZA*NOW:
Trafigura ‘still working to keep contract alive’ February 19, 2001
Background:
Oil scandal row goes to UK court February 9, 2001
Oil man Kunene also trades arms November 17, 2000
Reputations valued over oil November 13, 2000
State rocked by R1,5bn oil scandal November 3, 2000
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