Barrick Gold’s ABX-T former subsidiary in Africa was paying as much as US$1.2-million annually to a powerful group of Tanzanian government officials as recently as 2015, triggering internal concerns that the payments were violating its anti-corruption policies, company e-mails and memos show.
The subsidiary, British-based Acacia Mining, was making the payments to dozens of Tanzanian civil servants on a national law-enforcement task force, known as the NTF, which reports directly to Tanzania’s president. The payments were in addition to Acacia’s regular funding of Tanzania’s civilian police for security around its gold mines.
The e-mails and memos, obtained by The Globe and Mail after they were cited in a legal case currently under way in the High Court of Justice in London, show that Acacia executives were worried about the company’s risk exposure because the payments could create the appearance of “undue influence” over Tanzanian public servants. One internal memo cautioned that the task force was a powerful body and any changes to the payments should be carefully managed “for political as well as operational reasons.”
Acacia’s payments, which began in 2008, were funnelled to as many as 60 officials on the task force by 2015, the e-mails say. They included per-diem payments that were often much larger than standard per diems under Tanzanian government guidelines. The payments also covered other expenses by the officials, including car hire and fuel.
The payments were halted in November, 2015. Barrick, which owned about 64 per cent of Acacia’s shares at the time, later bought the remainder of Acacia’s shares in 2019 and now runs the Tanzania mines itself.
The task force, which included intelligence agents, police and military officials, was paid from Tanzania’s national budget and was responsible for monitoring and investigating any threats to Tanzania’s critical infrastructure. The Acacia gold mines were deemed to be included in its mandate, leading to Acacia’s payments to the task force, although the company e-mails complained of a lack of transparency about the NTF’s activities. Acacia made weekly payments to three bank accounts from which the task force members drew their allowances, the e-mails show.
Violence around the gold mines, especially the North Mara mine, has been an issue for Barrick for more than a decade. Scores of villagers have reportedly been killed after entering the North Mara site in search of waste rock from which gold can be extracted. In the London court case, 10 villagers are seeking damages for alleged abuse by police and security guards leading to deaths or injuries at North Mara and its surrounding villages from 2014 to 2019.
The Globe has been documenting police-related deaths at North Mara since 2011. Barrick has described the violence as a “legacy” issue that it has now resolved. But human-rights groups, including the British-based group Rights and Accountability in Development, have said that dozens of police shootings and assaults have continued since Barrick’s takeover in 2019, with at least six incidents causing deaths.
Nick Rowell, who was Acacia’s chief compliance officer at the time, said in an e-mail to colleagues in September, 2015, that the “government support payments” posed a risk to the company and “no longer comply with our anti-corruption policies.”
In an earlier e-mail that month, he cast doubt on the legitimacy of two NTF internal units that were receiving payments from Acacia. “Payments to the so called armed robbery unit, and the so called underground unit, should – from a purely anti-corruption compliance perspective – be suspended immediately,” he said.
Another senior executive, Peter Geleta, said in a separate e-mail that “a few of us” had been complaining about the payments for 18 months “and it is clear to me that our own people are protecting this domain.” The payment system, he said, “places the company under huge reputational risk.”
Several months earlier, a memo to Acacia management by chief security adviser A.D. Firth had raised concerns about “the inference of undue influence” and “liability for the actions of the NTF” as a result of the payments. It called for a comprehensive review of the payments.
“The NTF is an important and powerful agency with links to the highest level of Tanzanian government,” the memo said. “It has supported Acacia’s interests well for some considerable time and any changes to the relationship must be very carefully managed for political as well as operational reasons.”
The memo said the NTF’s operations and investigations have been useful to Acacia, but it also noted that these activities could be considered part of the NTF’s national duties, for which it was already being paid by the government.
Acacia’s payments to the NTF had “grown considerably since 2008″ and were not listed in Acacia’s annual core security budget, the memo noted.
Barrick did not respond to questions from The Globe about the internal e-mails and memos. Kathy du Plessis, a Barrick spokesperson, said Acacia had an independent board and management team until Barrick privatized it in 2019.
Acacia and Barrick have never exercised any control over the Tanzanian NTF or police, and the NTF was not involved in any of the incidents alleged by the claimants in the London court case, she told The Globe.
“We are confident that the allegations that have been made in the London court case are without merit, and look forward to having the opportunity for the London courts to finally adjudicate this matter and put it to rest,” she said.
In the legal proceedings in London, a lawyer for the Tanzanian claimants argued that Acacia’s payments to both the NTF and the civilian police showed that the company had an unusually close relationship with the police and that its payments had secured influence over them. But a lawyer for Barrick said the NTF payments were a tangential issue.
In their statement of claim, lawyers for the Tanzanian claimants said the company regularly made payments to the NTF “without any sufficient evidence that they related to services rendered.” The payments ended when the company recognized that they risked violating the company’s “anti-bribery and anti-corruption policies and its legal obligations,” the statement of claim said.
Barrick, in its statement of defence, said the payments to the NTF were “entirely proper” and the task force “provided important policing services which helped to prevent serious crime.” It said the payments ended in November, 2015, but it denied that they were ended because they risked non-compliance with Acacia’s anti-corruption policies. “The payments ceased due to economic circumstances,” it said.