Och-Ziff Judge Told by U.S. That Africo Isn't Fraud Victim

(Bloomberg) -- U.S. prosecutors told a judge that they don’t consider Africo Resources Ltd to be a victim of Och-Ziff Capital Management Group LLC’s sprawling African bribery scheme and that an Och-Ziff unit’s sentencing should go forward.

Investors in Africo say they’re entitled to as much as $600 million in restitution because they were victims of Och-Ziff’s 10-year conspiracy to bribe judges and other government officials. The investors say the scheme cost Africo control of the mine.

But federal prosecutors said Friday that they weren’t persuaded by new evidence that Africo was harmed, which lawyers for the Africo investors presented to them in April.

"The government does not believe that this new information changes the analysis," Assistant U.S. Attorney David Pitluck said in a letter to U.S. District Judge Nicholas Garaufis in Brooklyn, New York.

The judge is set to sentence an Och-Ziff unit after it pleaded guilty in September 2016 to participating in a bribery conspiracy to help acquire mining assets in several African countries, including the rights to the Kalukundi copper and cobalt mine in the Democratic Republic of Congo.

‘Undue Payment’

Jonathan Gasthalter, a spokesman for Och-Ziff, didn’t have an immediate comment on the filing. The fund had previously said that the “matter has been without merit throughout and this remains an attempt to receive an undue payment.”

Moe Fodeman, a lawyer for the Africo investors, declined to comment.

Och-Ziff has argued in court papers that the Africo investors can’t show they were directly harmed or lost property -- a position with which the U.S. still agrees. The fund argues that there were two separate plots involving the mine and it played no role in a legal dispute that resulted in Africo’s loss of mining rights.

The Africo investors have sought a hearing, saying Africo was initially considered a victim until Och-Ziff began lobbying prosecutors.

The case is U.S. v. OZ Africa Management GP, 16-cr-515, U.S. District Court, Eastern District of New York (Brooklyn).

©2018 Bloomberg L.P.

Bloomberg
Stay Updated With Business News News On BloombergQuint