The billionaire owner of mining company BSG Resources (BSGR) and two of his business associates are accused of paying late President Lansana Conte’s wife approximately US$10 million for the right to develop the vast Simandou iron ore in the country’s south.
The defendants are also accused of forging documents in order to conceal the bribes, according to a copy of the indictment seen by OCCRP.
Steinmetz’s co-defendants include French national Frederic Cilins, a former adviser to BSGR who in 2014 was sentenced to two years in prison by a New York court for obstructing a U.S. criminal investigation linked to the alleged bribery in Guinea.
The other co-defendant is Belgian national Sandra Merloni-Horemans who directed Onyx Financial Advisors, a Geneva-based firm which created companies used by BSGR in Guinea. Onyx established Pentler Holdings, a British Virgin Islands company through which bribes were allegedly paid to Mamadie Toure, Conte’s widow.
Mamadie Toure is also due to appear in court as a witness, as are several former BSGR executives.
Steinmetz’s legal team has dismissed the accusations, telling Reuters in December that the charges had “no basis in fact or in law.”
“Beny Steinmetz never paid a cent to Mme. Mamadie Toure. Beny Steinmetz never signed forged documents,” Marc Bonnant, Steinmetz’s Geneva-based lawyer said.
Steinmetz faces up to 10 years in prison, according to an announcement by the Public Prosecutor's Office filed last summer.
The criminal trial is the latest chapter in an international legal saga that has stretched more than a decade.
BSGR was awarded the lucrative Simandou rights in 2008 just weeks before the death of former president Lansana Conte.
But the rights were revoked in 2014 after a corruption probe launched by Guinea’s new president, Alpha Condé, found that BSGR had obtained them through bribery.
BSGR hit back with an arbitration claim against Guinea at the International Centre for Settlement of Investment Disputes. In 2019, the arbitration was suspended pursuant to a private agreement.
Meanwhile, Brazilian multinational corporation Vale S.A., which had partnered with BSGR in the Simandou project, was in 2019 awarded $2 billion by a London arbitration court which found that BSGR made fraudulent representations to induce Vale to invest in the project.
In further recovery efforts, Vale launched separate proceedings against Steinmetz personally and several former BSGR executives. In December 2019, an English judge ordered a worldwide freezing order against Steinmetz.
Steinmetz has sought new evidence to challenge the London arbitration, hiring Israeli private intelligence firm Black Cube to gather information which the Israeli businessman argues shows that Vale at the time wrongly concluded that the mining rights were obtained through bribery but made the investment anyway.
BSGR also brought a $10 billion lawsuit in New York against billionaire philanthropist George Soros and his pro-democracy organization Open Society Foundations. BSGR alleges that Soros lobbied the government of Guinea to strip BSGR of its mining rights. The case is pending.
Steinmetz in 2016 was arrested and placed under house arrest in Israel while authorities investigated allegations he had arranged bribes to ensure BSGR could secure the Guinean mining rights.
