Mine fraud case continues
Rio Tinto and two former company leaders will continue facing fraud charges in the US.
A bid to have the charges thrown out of court has been dismissed by the US securities regulator, the SEC.
The charges relate to allegations that the company and its former chief executive Tom Albanese and former chief financial officer Guy Elliott covered up multi-billion losses on a coal investment in Africa.
The SEC fraud allegations state that Rio Tinto and its executives tried to hide, or delay disclosure of mounting losses at the mine in Mozambique.
Rio paid $3.7 billion for the mine 2011, before writing off more than $3 billion in value less than two year later.
The deal cost Mr Albanese his job in 2013.
“This is not simply a case about Rio Tinto's valuation of Rio Tinto Coal Mozambique,” the SEC said in its filing, according to Reuters.
“Rio Tinto, Albanese, and Elliott faced enormous pressure to structure a successful deal in light of the fact that they were responsible for an earlier disastrous multibillion dollar acquisition.”
The company attempting to claim that the write-down was immaterial as it accounted for just 3 per cent of total assets at the time.
But the SEC says it would have slashed first-half earnings in 2012 by more than 50 per cent if the write-down had been properly stated in results.
Rio Tinto and the former executives have previously vowed to “vigorously” defend the case.