The Council of Ministers said yesterday that no investigation was necessary into reports that Australian mining firm BHP may have paid bribes in Cambodia in violation of US anticorruption laws.
On Wednesday, BHP announced it had provided investigators from the US Securities and Exchange Commission with evidence of possible violations of anticorruption laws involving interactions with government officials in an unnamed country that was not China.
Though BHP has so far declined to say where the alleged violations took place, Australian and British media reports last week cited company sources as saying the inquiry concerned payments to Cambodian officials.
The Cambodian government in 2007 said BHP had paid “tea money” in order to secure exploration rights in Mondolkiri province. An official denied last week that this concerned an illicit payment.
In addition to the SEC investigation, Britain’s Serious Fraud Office is making a “preliminary assessment” of possible corruption by employees at BHP.
Phay Siphan, spokesman for the Council of Ministers, said yesterday that the government has “no obligation” to investigate the commissions BHP paid the government as this had already been disclosed.
“It’s been stated by the Ministry of Water Resources,” Mr Siphan said.
The tea money controversy stems from comments made by Minister of Water Resources Lim Kean Hor in 2007, when he told the National Assembly that Prime Minister Hun Sen had telephoned him from Australia in 2006 to inform him of a $2.5 million signing bonus in the BHP contract.
Mr Kean Hor said at the time that the funds would be used to pay for an irrigation project in Pursat.
In a letter to UK-based activist group Global Witness in November 2008, BHP said the $2.5 million that Mr Kean Hor referred to as “tea money” was actually a BHP-controlled social development fund supporting the Danish Red Cross, the Wildlife Conservation Society and the Cambodian Mine Action Center, among other organizations. However, the company also said BHP had paid a $1 million fee to the government in 2006 in exchange for exploration rights.
In a report last year, Global Witness claimed that no record of the $1 million payment could be found on the government’s non-tax revenue statements for the period.
Mr Siphan said yesterday that all money received by Prime Minister Hun Sen was disbursed honestly.
Mr Hun Sen “is committed to society,” Mr Siphan said. “He wants to see things happening.”
Mr Siphan said he did not know where documentation of the government’s receipt and use of the BHP payments could be found.
Pursat provincial governor Khoy Sokha confirmed yesterday that 11 separate irrigation projects worth an estimated $20 million had been constructed in Pursat’s Bakan, Kandieng and Krakor districts since 2006.
However, Mr Sokha said he did not know where the money for the projects came from, referring questions to the Ministry of Water Resources.
The 11 projects cover land stretching over 80,000 hectares that is used by local farmers, he said, adding that a further 20,000 hectares of land was slated to be irrigated by 2011.
“We have 100,000 hectares of land for rice fields in Pursat province,” Mr Sokha said.
Phang Sareth, secretary of state for the Ministry of Water Resources, said he was unaware of how much of BHP’s money went toward irrigation projects in Pursat but that he would inform a reporter of that amount today.
Sar Sambath, a member of the government’s old anticorruption unit, said he was gathering more information on the tea money affair but that no investigation had yet been opened.
An official from the Danish Red Cross in Cambodia, who spoke on condition of anonymity because he was not authorized to speak to the news media, said yesterday that his organization had received the entire $132,362 allocated to it from BHP’s social development fund. The money was spent on water hygiene projects in Mondolkiri province, he added.
“We received all the money for improving activities in the target area,” he said, adding that the project had been carried out by an “external company” in 2008 and 2009.