Steinmetz and Malloch-Brown settle Guinea damages claim
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Legal action that pitted an Israeli diamond tycoon against a former UK government minister – and involved the billionaire investor George Soros and one of Africa’s richest mineral deposits – has been settled for €90,000.
Beny Steinmetz Group Resources, which is managed on behalf of the Steinmetz family, had sued Lord Malloch-Brown and FTI Consulting, its former public relations adviser, alleging breach of contract. BSGR claimed the peer and FTI Consulting acted in concert with Mr Soros in a campaign against the company’s ventures in Guinea.
BSGR has been the subject of a government corruption investigation in the west African country, where together with Brazil’s Vale it holds the rights to parts of the Simandou iron ore deposit.
The Financial Times revealed this year that a Guinean committee examining the country’s mining contracts had warned BSGR that its rights could be cancelled if it were concluded that the company had paid bribes to secure the rights to Simandou. BSGR denies any wrongdoing.
Mr Soros was said in BSGR’s writ to have put pressure on Lord Malloch-Brown, FTI’s chairman in Europe, to act to end his group’s relationship with BSGR. FTI was accused of a conflict of interest by BSGR.
Two months after the writ was issued, FTI said all claims against it and Lord Malloch-Brown had been settled without any admission of liability. The consultancy said its accepted offer of €90,000 was considered to be less than what it and Lord Malloch-Brown may have incurred in irrecoverable costs by pursuing an application to have the claim struck out.
BSGR had said FTI and the peer – a minister in Gordon Brown’s government as well as a former UN deputy secretary-general – had “conceded defeat and agreed to pay substantial compensation and legal costs”.
FTI said: “Neither FTI Consulting nor Lord Malloch-Brown has ‘conceded defeat’ in any way.”
FTI was retained by BSGR from 2009 to 2012. BSGR said the money paid would be donated to charities and good causes in Guinea.
Comments