LONDON Frederic Cilins,
an associate of Israeli diamond billionaire Beny Steinmetz, was
arrested April 14 in the United States and accused of
attempting to obstruct an ongoing investigation into how BSG
Resources Ltd. (BSGR), the mining arm of Steinmetzs BSG
Investments Ltd., won a concession to one of the worlds
largest untapped iron ore reserves, according to documents seen
by AMM sister publication Steel First.
"The arrest and investigation
supports the government of Guineas policy of
transparency. We welcome support from the USA in our efforts to
strengthen the rule of law in Guinea," Christian Sow,
Guineas minister for justice, said.
A criminal complaint was filed
April 15 in U.S. District Court in New York, charging Cilins
with obstructing a criminal investigation; tampering with a
witness, victim or informant; and destroying, altering or
falsifying records in a federal investigation, the U.S. Justice
Department said on its website. The obstruction charge carries
a maximum penalty of five years in prison, while the latter two
each carry a maximum penalty of 20 years in prison.
Cilins arrest is part of a
wider investigation, led by the Justice Department, into
BSGRs purchase of Blocks 1 and 2 of the Simandou iron ore
deposit in Guinea. The company was handed the concession to
those blocks after they were stripped from Rio Tinto Plc by
former dictator Lansana Conte in 2008.
A version of this article was first published by AMM sister
publication Steel First.