Mark Van Scyoc
The Kinross Gold Corporation has welcomed the end of the US Securities and Exchange Commission (SEC) regulatory investigation of its West African mining operations.
The Canadian-based senior gold mining company stated it has resolved the issue through an agreed-upon cease and desist order, without any material adverse effect on their finances or operations. The order makes no findings of bribery by the Company, but cites Foreign Corrupt Practices Act (FCPA) violations arising from the company’s repeated failure to implement adequate accounting controls of two African subsidiaries. Kinross had acquired the subsidiaries in full knowledge of compliance and control failures, and took almost three years to resolve issues despite multiple internal audits flagging widespread deficiencies. Tracy Price, Deputy Chief of the SEC Enforcement Division’s FCPA Unit, stated “Companies should take particular care to remediate known accounting controls issues when making acquisitions to mitigate the risk that company funds will be misused for unauthorized purposes.”
Accepts civil $950k penalty
Both Kinross and the SEC stated there was full cooperation throughout the investigation, and the firm has taken steps to improve and strengthen its compliance program and internal accounting controls and practices. Kinross neither admitted nor denied the findings of the order to resolve the investigation. As part of the settlement, the Company has agreed to pay US$950,000 to the SEC as a civil penalty and report to the SEC semi-annually for a one-year term on the status of its West African compliance measures. The order is final and not conditional on court approval.