The Wall Street Journal | By: Dave Michaels | October 17, 2017:
Miner valued Mozambique coal assets at $3 billion though value was internally assessed at negative $680 million, according to lawsuit.
U.S. regulators on Tuesday sued Rio Tinto RIO -0.46% PLC and two former top executives over claims they misled investors about the value of Mozambique coal assets obtained in a disastrous acquisition that caused huge losses for the global mining giant.
Rio Tinto continued to value the mining assets in Mozambique at more than $3 billion despite an internal assessment that they were worth negative $680 million, according to a lawsuit filed in Manhattan federal court.
The Securities and Exchange Commission’s lawsuit alleges that former Chief Executive Thomas Albanese and former Chief Financial Officer Guy Elliott knew about the project’s rapidly declining value but didn’t disclose it to investors and misled their board of directors about the scope of the problems, the SEC said.
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