BHP Billiton Heading For Possible SEC Action

Michael Teague |

BHP Billiton Ltd. (BHP) , the world’s largest industrial metals and minerals miner, is under renewed scrutiny from the US Securities and Exchange Commission.

In a statement on the company’s website, BHP said that, “The issues relate primarily to matters in connection with previously terminated exploration and development efforts, as well as hospitality provided as part of the company’s sponsorship of the 2008 Beijing Olympics.”

The original SEC inquiry into the matter began in 2009, when the commission requested information from the Australian firm. This resulted in BHP first disclosing that it had potentially discovered evidence of US anti-corruption laws being violated.  But the company’s second, damning disclosure was the result of pressure from the US Department of Justice as well as the Australian Federal Police, both of whom were investigating not only events related to the Beijing Olympic games, but also terminated mineral exploration projects in Cambodia and the Philippines.

On Friday, however, the company looked as though it was trying to get out in front of a scandal of some sort, with the additional disclosure of the possibility of “enforcement actions” being taken against it in the near future.

BHP has just posted a 13th consecutive quarter of record iron-ore production, and earlier in the week CEO Andrew Mackenzie announced that the company would be expanding its shale drilling operations in the US. The company’s stock, however, is down almost 12 percent on the year to its current price of $67.61.

The UK’s Telegraph has had the most thorough report on the matter heading into midday trading. It cited Australian reports from earlier in the year that claimed the company used its involvement in the Beijing Olympic Games to enhance relations with the heads of China’s state operate steel companies, including Chinalco, Baosteel, and the China Iron & Steel Association.

It is not yet clear what sort of action the SEC could take against the company, as all parties have declined to comment, aside from the statement on the company website.

[Image: BHP Billiton's Escondida mine, courtesy of Flickr Creative Commons]

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Companies

Symbol Name Price Change % Volume
ARMI Aurum Resource & Asset Management Inc 0.01 -0.05 -83.55 1,520
BHP BHP Billiton Ltd. ADR (Sponsored) 27.10 0.15 0.56 3,929,710

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