RAPAPORT… Six officials involved in the Canadile concession of the Marange mine in Zimbabwe appeared in court Monday charged with fraudulently acquiring the mining operation.
Five officials involved the charges are from the Zimbabwe Mining Development Corporation (ZMDC), a company under U.S. and EU sanctions, and one is from Core Mining out of South Africa. The suspects appeared before provincial magistrate Mishrod Guvamombe who remanded them in custody to today for continuation of their hearing, The Herald reported.
Canadile Resources a joint venture between the ZMDC subsidiary Marange Resources and Core Mining.
The officials include ZMDC chief executive Dominic Mubaiwa, company secretary Tichaona Muhonde, chairperson Gloria Mawarire, and board members Ashton Ndlovu and Mark Tsomondo. Canadile’s local representative, Lovemore Kurotwi, was also arrested.
Suspects allegedly led government officials to believe that they had sufficient resources to operate a concession at Marange, saying that South Africa-based company, BSGR, was interested in investing $2 billion in Zimbabwe.
The ZMDC has reportedly taken over operations at the concession since the arrests. Mines minister Obert Mpofu told reporters this past week that the government was not looking for new investors in the Canadile concession.
Canadile is one of two companies, along with Mbada Diamonds that have been mining diamonds at Marange since November 2009. Another company, Anjin Limited, is expected to begin operations shortly.
The charges came as the Kimberley Process was debating Zimbabwe’s inclusion in the regulatory body at its annual plenary in Jerusalem. The Kimberley Process did not reach a decision on whether to allow exports from Marange as negotiations continue this week.
Separately, African Consolidated Resources (ACR), which previously owned the Canadile and Mbada concessions, reported that it has been charged with fraud and with violating the Zimbabwe Precious Stones Trade Act in the country’s High Court.
ACR explained that the charges claim it acquired the concessions by using subsidiaries which were not registered at the time, a process deemed fraudulent by the authorities. The London AIM-listed company argued that this should make no difference to the validity of its Marange concessions and that the charges are therefore groundless.
In September, the High Court rescinded a previous decision confirming ACR’s title to the diamond claims. ACR has appealed the decision and stressed that until the appeal is settled, the company “remains the only legal holder of the Marange claims.”