TRIAL v. Argor-Heraeus S.A.

Court:
Domestic Courts
Country:
Switzerland
Status:
Active
Case Lawyer:
Legal Action against Business Actors who Profit from Pillaged Gold

From 2004-2005, the Swiss gold refinery Argor-Heraeus S.A. refined almost three tons of gold ore that was pillaged from the Democratic Republic of Congo by an armed group whose activities were financed by the traffic in this gold ore. In essence, pillage means theft during war, and it is a war crime. When business actors knowingly purchase assets pillaged by others, they too can be held culpable for pillage. Those who materially assist such transactions may also be criminally liable. Following submission to the Swiss Federal Prosecutor of a criminal complaint against Argor-Heraeus, and review and preliminary investigation by Swiss authorities, the prosecutor dismissed the case in March 2015. 

Facts

In 2004 the UN Security Council set up the UN Group of Experts for the Democratic Republic of Congo to evaluate the effectiveness of the UN arms embargo on the DRC, put in place the previous year. In its reports, the Group of Experts identified several entities allegedly involved in illegal appropriation of gold from the northeast of the DRC. These included the British company Hussar Ltd., based in Jersey (Channel Islands), and Argor-Heraeus S.A., a Swiss precious metals refiner.

Documents demonstrate that pillaged gold, mined in an area called Concession 40 in the rebel-controlled Ituri region, had been shipped via Uganda to Switzerland to be processed into ingots by Argor-Heraeus. According to the Group of Experts, the Swiss company could not have been unaware that the gold in question had been pillaged from the DRC.

The refined ingots were then, evidence suggests, sold on by Hussar to final customers, largely banks.

Under Swiss law, a criminal complaint, or dénonciation pénale, can be filed with the Federal Prosecutor’s office by any private citizen who has knowledge of or suspects a criminal act. The Federal Prosecutor assigned to the case then reviews the allegations and evidence presented, and decides whether or not to launch an official investigation, which may result in criminal charges.

On November 1, 2013, Swiss NGO TRIAL (Track Impunity Always), working with support of the Justice Initiative, submitted a dénonciation pénale to the Swiss Federal Prosecutor in Berne, requesting that an investigation be opened into suspicions that Argor-Heraeus S.A. had committed laundering of the proceeds of crime and complicity in the crime of pillage. A dedicated website, stop-pillage.org, was created to show how such behavior can amount to the crime of pillage.

On November 4, 2013, the prosecutor opened a formal investigation of the allegations, and Swiss Federal Police conducted a search of the Mendrisio (Tessin, Switzerland) headquarters of Argor-Heraeus, seizing documents and computers. Argor-Heraus brought a legal challenge to the prosecutor’s right to conduct such a search, but on January 24, 2014, the Swiss Federal Criminal Court rejected this argument, concluding that the strength of the evidence warranted the search.

Open Society Justice Initiative Involvement

The Justice Initiative provided legal advice and investigative support to Swiss NGO Trial International. 

Arguments

The principle complaint against Argor-Heraeus addresses suspected involvement in laundering the proceeds of a major crime (blanchiment aggravé); the complaint also alleges that Argor-Heraeus was complicit in the underlying crime of pillage. The complaint also sets out the involvement of other companies such as Hussar Ltd., and its London service affiliate, Hussar Services Ltd. The evidence was made available to the UK and Jersey authorities. 

Timeline

November 1, 2013. TRIAL files the dénonciation pénale with Swiss Federal Prosecutor in Bern, alleging aggravated laundering of the proceeds of crime, and complicity with the war crime of pillage by Swiss gold refinery Argor-Heraeus S.A.
November 4, 2013. Swiss police conduct a raid of the Argor-Heraeus headquarters in Mendriso, seizing numerous computers and documents. Argor-Heraeus challenges the legality of the search.
January 24, 2014. The Swiss Federal Criminal Court upholds the legality of the search of the Mendriso headquarters, also affirming the aggravated nature of the laundering allegations.
March 10, 2015. The Swiss Federal Prosecutor’s office determines to close the investigation.

Findings

The Swiss Federal Prosecutor acknowledged that Argor had refined pillaged gold, and that the company had violated its legal duty of diligence. Nonetheless, the Federal Prosecutor decided to close the case on March 10, 2015.The Prosecutor found that while indications as to the origin of the gold “should have raised Argor’s suspicions….[Argor] failed to clarify the origin of the gold although its internal regulations required it to do so if there were any doubts as to the origin of the raw material for refining.”

Nevertheless, the prosecutor concluded that Argor-Heraeus should not be held responsible for any wrong-doing as “it is not clear…that the defendants had any doubts as to, or concealed any evidence of, the criminal origin of the gold.”