Glencore plc

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Case Summary

Company Name
Glencore plc
Stock Symbol
Class Period
September 30, 2016 to July 2, 2018
Motion Deadline
September 7, 2018
District of New Jersey

The complaint charges Glencore and certain of its officers with violations of the Securities Exchange Act of 1934.  Glencore engages in the production, refinement, processing, storage, transport and marketing of metals and minerals and energy and agricultural products worldwide.  Glencore common shares trade on the OTC Exchange under the ticker symbols “GLNCY” and “GLCNF.”

The complaint alleges that throughout the Class Period, defendants made materially false and misleading statements regarding the Company’s business and operations, and specifically its compliance with the Foreign Corrupt Practices Act (“FCPA”).  According to the complaint, defendants made false and/or misleading statements and/or failed to disclose adverse information regarding the Company’s compliance with money laundering and bribery laws that would foreseeably subject it to heightened scrutiny by U.S. and foreign government bodies under the FCPA.  As a result of defendants’ false statements and/or omissions, Glencore securities traded at artificially inflated prices during the Class Period, with the price of its GLNCY shares reaching close to $12 per share.

On May 18, 2018, Bloomberg reported that the United Kingdom’s Serious Fraud Office was preparing to open a formal bribery investigation into Glencore’s work with Israeli billionaire Dan Gertler and the leader of the Democratic Republic of Congo.  According to Bloomberg, a “U.S. hedge fund manager . . . , which funded some of Gertler’s operation in Congo, admitted in 2016 to having conspired to bribe Congolese officials with the help of an unidentified Israeli businessman.”  On this news, the price of GLNCY shares fell over 5%, to close at $10.13 per share on May 18, 2018, while the price of GLCNF shares fell nearly 6%, to close at $5.06 per share on May 18, 2018.

Then, on July 3, 2018, before the market opened, Glencore disclosed that the U.S. Department of Justice had issued a subpoena to its subsidiary Glencore Ltd “to produce documents and other records with respect to [its] compliance with the [FCPA] and [U.S.] money laundering statutes.  The requested documents relate to the Glencore Group’s business in Nigeria, the Democratic Republic of Congo and Venezuela from 2007 to present.”  On this news, the price of GLNCY shares fell $0.86 per share, or over 9%, to close at $8.31 per share on July 3, 2018, while the price of GLCNF shares fell $0.41 per share, or nearly 9%, to close at $4.20 per share on July 3, 2018.

Class Period: September 30, 2016 - July 2, 2018
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