The High Court of England has deemed the criminal investigation into Eurasian Natural Resources Corporation (ENRC) to be unlawful. The 10-year case was the result of improper actions by the British economic crime agency The Serious Fraud Office (SFO) and the well-known law firm «Dechert LLP».
Just over 10 years ago, ENRC began an internal investigation related to corruption schemes at the Sokolov-Sarbay Mining and Processing Production Association (SSGPO). For this purpose, ENRC hired the law firm «Dechert».
Some time later, an article appeared in the famous magazine «The Times», which contained confidential information precisely about ENRC's internal investigation. The publication clearly alarmed not only the entire management of the company, but also the British economic crime agency, the SFO.
According to case files, the head of the SFO, Mr McCarthy, contacted ENRC's management with an offer to assist with the internal investigation, or more precisely, to discuss management and compliance programmes at the company's enterprises. At the same time, Mr McCarthy assured that the SFO had no intention of conducting an investigation into ENRC itself.
All negotiations between ENRC and the SFO were conducted through a partner at the law firm «Dechert», Neil Gerrard.
Meanwhile, the leaks of information did not stop. Several ignominious articles later, the SFO officially announced it was conducting a criminal investigation into ENRC.
In March 2013, Mr Gerrard presented ENRC with his report on alleged violations found at the Kazakhstani enterprises. Shortly afterwards, similar information appeared in the media, and in April of the same year, the SFO announced the start of its own review.
In August 2023, the SFO concluded its investigation, finding no evidence of wrongdoing on the part of ENRC.
The High Court of England ruled that the initiated proceedings were the result of collusion between Neil Gerrard and the SFO management. Mr Gerrard not only cooperated with the SFO against his client, but also supplied knowingly false information about the results of the internal review, which became the basis for the SFO's investigation.
Furthermore, ENRC representatives claim that the leaks of information were also the work of Mr Gerrard, and were carried out with the aim of shaping negative public opinion about the company's activities.
The exact scale of the financial consequences for ENRC has yet to be determined. However, the 10-year investigation and numerous counter civil lawsuits have clearly taken their toll on the company.
In November and December 2013, ENRC was delisted from the LSE and KASE exchanges, respectively. At that time, ENRC's market capitalisation stood at £3 billion, which is very low for such a large company.
At the same time, ENRC became part of Eurasian Resources Group (ERG). The company operates in the extraction and processing of natural resources in 16 countries around the world, including Kazakhstan.
Over the next five years, ERG intends to invest more than $6.5 billion in Kazakhstan. A significant portion of the investment will go into JSC TNK «Kazchrome», where they plan to increase production volumes to 2.1 million tonnes by 2025.