Kinross Gold Corp. said in a statement Friday that it is under investigation for corruption in West Africa by the U.S. Securities and Exchange Commission and the Justice Department.
The company said it received SEC and DOJ subpoenas related to possible internal control deficiencies and improper payments to government officials.
Toronto-based Kinross, the world’s fifth biggest gold producer, said it launched an internal investigation when it learned of the allegations two years ago.
It received the SEC subpoena in July 2015. It said it is cooperating with U.S. authorities.
Kinross has mines and projects in the United States, Brazil, Chile, Ghana, Mauritania, and Russia. Its shares trade on the Toronto and New York stock exchanges.
The SEC subpoena requested “records of communications and payments to officials and contractors at Kinross’s operations in Mauritania and Ghana,” the Wall Street Journal said.
Kinross said that after a 25-month investigation, it hasn’t yet “identified issues that . . . would have a material adverse effect on the Company’s financial position or business operations.”
The DOJ and SEC don’t comment on ongoing FCPA investigations.
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Here’s the full statement from Kinross:
Toronto, Ontario – October 2, 2015 – In response to media inquiries, Kinross Gold Corporation (TSX: K, NYSE: KGC) wishes to address the circumstances surrounding an ongoing regulatory review in relation to its West Africa mining operations.
In August 2013, Kinross received information regarding allegations of improper payments made to government officials and certain internal control deficiencies at its West Africa mining operations. Kinross takes such allegations very seriously and action was immediately taken in accordance with Kinross’ Whistleblower Policy. External legal counsel was immediately retained to conduct an objective internal investigation into the allegations.
In March and December 2014, and July 2015, Kinross received subpoenas from the United States Securities and Exchange Commission (the “SEC”) seeking information and documents on substantially the same subjects as had previously been raised. In December 2014, Kinross received similar requests for information from the United States Department of Justice (the “DOJ”).
Kinross is fully cooperating with the SEC and DOJ and continues to diligently pursue its own internal investigation, which, over the course of the past 25 months, has not identified issues that Kinross believes would have a material adverse effect on the Company’s financial position or business operations. Our internal investigation is ongoing, and additional issues or facts could become known as the investigation continues.
It is important to note that the SEC subpoenas expressly state that: “This investigation is confidential and nonpublic and should not be construed as an indication by the Commission or its staff that any violation has occurred, nor as a reflection upon any person, entity or security.”
Kinross is committed to operating in accordance with the highest ethical standards and conducting business in an honest and transparent manner that is in compliance with the law. Kinross has a longstanding culture of ethical conduct and accountability consistent with its Code of Business Conduct and Ethics and related anti-corruption compliance program.
As this is an ongoing regulatory matter, Kinross will not be commenting further at this time.
Richard L. Cassin is the publisher and editor of the FCPA Blog. He can be contacted here.