BRASILIA – Brazil’s authorities will investigate miner Vale SA over possible corruption in misleading officials about the safety of its dam that burst and killed hundreds, a spokeswoman for the Mines and Energy Ministry said on Friday.
If found to have violated Brazil’s 2013 anti-corruption law, Vale could face a fine of up to 20 percent of its 2018 gross revenue.
In 2017, the company reported 109 billion reais ($28.79 billion) in revenue and net income of 17.6 billion reais.
Vale is due to report fourth-quarter 2018 earnings on March 27.
Bloomberg first reported that the ministry’s mining secretary Alexandre Vidigal de Oliveira said in an interview that he had requested an investigation be opened into whether Vale had colluded with auditors to misrepresent the safety of the dam.
Vale shares fell as much as 5.4 percent after that report was published, before partly recovering to be down 0.4 percent in early afternoon trading.
Vale said in a securities filing on Friday that it had not been informed of the investigation and denied that any of its actions could fall under the scope of the anti-corruption law. The company said it has always acted within the law and denied any interference in the government’s oversight of dams.
A tailings dam at Vale’s Corrego do Feijao iron ore mine in the southeastern state of Minas Gerais burst on Jan. 25, releasing a torrent of mining waste that buried its workers and local residents. The disaster in the town of Bruamdinho has left at least 182 confirmed dead and more than 100 missing and presumed dead. (Reuters)
