US regulator gives Gold Fields $210m BEE deal green light

From Reuters

A Gold Fields Mine company logo is seen outside the South Deep Gold mineSA’s Gold Fields said the foreign anti-corruption unit of a US financial markets regulator had recommended that no further action be taken against it following an investigation into a $210 million black empowerment deal.

Gold Fields is subject to scrutiny from US watchdogs because it is also listed in the United States. It was being investigated over the 2010 deal, and also the granting of a mining licence to the company for its South Deep mine near Johannesburg. The Securities Exchange Commission’s (SEC) foreign anti-graft unit was investigating the case. Gold Fields said in a statement it had been notified that the unit “will not recommend to the Commission that enforcement action be taken” against it.

The transaction saw Gold Fields give a 9 percent stake in South Deep to a group of black investors to meet government targets for black economic empowerment (BEE), including black ownership. The ruling African National Congress (ANC) has championed BEE to redress the inequalities left by white-minority rule, which ended in 1994.

But some critics say the programme has mainly benefited a narrow elite of politically connected individuals and failed to transform what is still one of the world’s most unequal societies.

The South Deep BEE deal, whose beneficiaries included ANC chairwoman Baleka Mbete and relatives of anti-apartheid campaigners such as Nelson Mandela, came under particular scrutiny from the SEC, which is yet to make a decision on whether to take its unit’s advice to drop the case.

The beneficiaries of the BEE deal have not been accused of wrongdoing.