Australian lawmaker calls for inquiry into coal quality certificates

ALS

21/11/2022 09:07

SYDNEY, Nov 21 (Reuters) - An independent Australian
lawmaker on Monday accused companies of lying about the quality
of their coal exports for years, and called for a parliamentary
inquiry into the matter.
    Coal companies operating in Australia are exporting coal
with fraudulent quality certificates and paying cover-up bribes
to representatives of overseas customers, independent MP Andrew
Wilkie said in parliament, citing thousands of documents from a
whistleblower.
        He claimed the misconduct includes exports to Japan,
South Korea, China and India, and involves companies including
Anglo American  AAL.L , Glencore  GLEN.L , Peabody  BTU.N  and
TerraCom  TER.AX . 
        Wilkie said accounting giant Ernst and Young was aware
of the issue, without elaborating, and he also named Macquarie
Bank  MQG.AX  but did not specify how the company was involved.
  
    "Companies operating in Australia are using fraudulent
quality reports for their exports, and paying bribes to
representatives of their overseas customers to keep the whole
scam secret," Wilkie said in his speech in parliament.
    "And this has allowed them to claim, for years, that
Australian coal is cleaner than it is in order to boost profits
and prevent rejection of shipments at their destination," he
added.
    Coal testing companies SGS and ALS are accused of having
participated in the fraud by manually amending certificates of
coal quality, Wilkie said.
    Anglo-American and Peabody denied the allegations. Glencore
said it had not been involved in any investigations or
proceedings related to the matter. Ernst and Young and Macquarie
Bank declined to comment.
    SGS, ALS and TerraCom did not immediately respond to
requests for comment.
    The allegations were similar to those first reported by the
Australian Financial Review in 2020.
    Then allegations in an unfair dismissal case claimed
Australian miner TerraCom Ltd had worked with ALS’s
Brisbane-based testing laboratory to falsely upgrade the quality
of its coal in export documentation. TerraCom denied the
allegations, while ALS launched an independent investigation
into the claims.
    ALS said in 2020 the probe found that about half the
certificates it provided for export coal samples over the past
decade had been manually altered. It did not give a reason for
the alterations but said the probe found no evidence of bribery.
    Corporate watchdog Australian Securities and Investments
Commission (ASIC), which investigated the allegations, said in
an October letter to ALS that it had reviewed all the evidence
and decided against taking any action against the company.
    “However, having regard to ASIC’s jurisdiction, we are
currently investigating possible misleading market disclosures
by coal miner TerraCom and whistleblower-related matters. The
investigation is well advance," an ASIC spokesperson told
Reuters, referring to the allegations first made in 2020.
 (Reporting by Lewis Jackson; editing by Praveen Menon and Ana
Nicolaci da Costa)
 ((lewis.jackson@thomsonreuters.com; Reuters Messaging:
@lewjackk))