The head of junior miner Brockman Mining has been charged with corruption in Hong Kong after being under investigation since October 2011.
Hong Kong’s Independent Commission Against Corruption brought on the charges against Luk Kin Peter Joseph, with Brockman saying he will defend the charges emphatically, SMH reported.
According to Hong Kong’s ICAC, Luk, previously executive director of China Mining Resources Group (CMRG), is looking at two charges for the sale of a CMRG subsidiary.
It goes back to 2008 and concerns Luk presenting CMRG shares worth $330,000 (HK) to previous CMRG financial controller Yu Oi-kee after Oi-kee put through the sale of a company subsidiary, Cell Therapy Technologies Centre Limited.
It claims Luk presented and agreed to an “advantage consisting of 1.5 million shares of the company in relation to the sale of one of its subsidiaries at $15 million”, ninemsn reported.
He is accused of conspiracy to use a document with the aim of misleading their principal.
“Mr Luk has informed the company that charges in relation to certain alleged offences under the Prevention of Bribery Ordinance and the Crime Ordinance have been laid against him today by ICAC and he was currently on bail pending the relevant hearings. Mr Luk refutes the charges and intends to defend the allegations made against him,” the company said in a statement.
Luk stayed on as chief executive of the company even while being investigated for corruption over the past two years.
Brockman is attempting to enter the Australian mining sector but the corruption charges have marred its standing. But the company said it would continue its attempts regardless of the corruption charges.
“The company is of the view that the normal daily business and operations of the group will not be affected and Mr Luk will continue to undertake and discharge his duties as the chief executive and an executive director of the company,” Brockman said.
“The board will continue to monitor the development of the prosecution and assess its impact to the operation of the group.”
The corruption charges come amidst an infrastructure access dispute between Brockman and Fortescue Metals Group.
The junior explorer is trying to gain access to Fortescue Metal Group’s rail infrastructure in the Pilbara and wants to haul up to 20 million tonnes of iron ore per year from Marillana to a proposed rail spur near Port Hedland.
But Fortescue had put a $576 million price tag on rail access.
But Western Australia’s economic regulator set a maximum price for access last week at $316.9 million, which is 45 per cent lower than what Fortescue proposed.
It set a minimum price of $84.7 million. The companies have to negotiate a price between the two.
But Fortescue is still not ready to discuss the final cost with Brockman because it felt Brockman had not established it had the financial capability to construct the Marillana iron ore venture.
Fortescue is also unsure if Brockman has the extra capacity on the railway for it to use.
And Fortescue does not have to negotiate with the junior miner until it is guaranteed these problems are solved as per WA’s third party access laws.
If they fail to reach an agreement on a price, a second arbitrator will be called in to decide how much Brockman should pay for the infrastructure.