The UK’s financial watchdog is investigating Rio Tinto for allegedly misleading the market about a £5bn copper mining project in Mongolia.
According to the Daily Mail, Rio knew that the Oyu Tolgoi Mine was behind schedule and on budget long before investors were notified. Rio, a mining giant, tried to raise £1.3bn in 2019 to finish the project. He blamed burgeoning technical costs.
Whistleblowers, however, claim that the majority of cost overruns are due to poor project management.
International regulators are joining the investigation into the allegations of poor management at the mine. The Daily Mail reported that the Mongolian government launched an independent review and that the US Securities and Exchange Commission is also preparing for an investigation.
This news comes just days after Rio Tinto was issued a £186.36m penalties by Australian authorities. Rio Tinto has stated that it will contest the fine.
The Australian Taxation Office imposed a fine for denial of interest deductions for an isolated borrowing used to pay an internal dividend in 2015. Rio Tinto was also asked to repay the borrowed amount. However, the interest assessment by the authorities saw Rio Tinto pay approximately £14.2m.
Despite this news, Rio Tinto’s share prices are up 1.15 percent today and stand at $100.47AUD.
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