Foreign Affairs

Biden Admin Weighs Easing Sanctions On Mining Mogul Accused Of Corruption To Advance EV Agenda: REPORT

Official White House Photo by Adam Schultz

The Biden administration is considering easing sanctions on an Israeli mining mogul who has been accused of cheating the impoverished population of an African nation to advance its electric vehicle (EV) agenda, according to The New York Times.

There are some officials inside the administration who want to allow Dan Gertler, a billionaire executive in the mining and natural resources industries, to sell his positions in three major copper and cobalt operations in the Democratic Republic of the Congo (DRC), according to The New York Times. The hope is that Gertler closing his positions in the mines will attract investment from companies that are friendly to the West and can play a part in the administration’s EV agenda. However, some officials are opposed to giving Gertler a deal because he has been accused of corruption and enriching himself at the expense of the Congolese people.

Cobalt and copper are both essential components for EV batteries, and the DRC sits on about 76% of the world’s cobalt, according to the NYT. The Biden administration is pushing EVs aggressively as part of its broader climate agenda, spending big and issuing stringent regulations to significantly increase the share of EVs on the road over the next decade.

Chinese companies and interests dominate the DRC’s mining industry, and officials in favor of easing sanctions on Gertler hope that Western companies that left the DRC, in part because of concerns about Gertler’s alleged corruption, will return if he is out of the picture, according to the NYT.

The Trump administration imposed sanctions on Gertler in 2017, asserting that he was involved in corrupt mining and oil deals and had shortchanged the Congolese people, but the sanctions were later eased in the final days of the Trump administration, according to the NYT. The Biden administration reimposed the sanctions in March 2021, stating at the time that easing restrictions on Gertler was “inconsistent with America’s strong foreign policy interests in combating corruption around the world.”

The U.S. sanctions that currently apply to Gertler effectively freeze him out of the global financial system, according to the NYT. If the deal is formalized and finalized, Gertler stands to regain access to the system provided he meets his end of the agreement.

Gertler has consistently disputed the corruption allegations, enlisting high-powered attorneys and political acquaintances in the DRC in an effort to get the sanctions dropped, according to the NYT. Various human rights groups and watchdogs, meanwhile, have accused Gertler of corruption and exploiting the DRC for his own financial gain.

“To ease sanctions now seems ludicrous, giving Gertler a free pass to profit from ill-gotten gains,” Anneke Van Woudenberg, the executive director of Rights and Accountability in Development, a British nonprofit that keeps tabs on mining deals in the DRC and elsewhere, told the NYT. “The deal leaves Gertler enriched, unscathed and unaccountable — with little regard for those who matter most: the people of the DRC.”

Amos Hochstein, special presidential coordinator for global infrastructure and energy security, is apparently one of the leading supporters of the plan to ease sanctions on Gertler within the administration, according to the NYT.

Gertler no longer has a direct ownership stake in at least two of the three mining operations that would be subject to an agreement with the Biden administration, but he earns royalties worth approximately $110 million each year from all of his business interests in the DRC, according to the NYT.

As part of the deal, Gertler would have to submit a detailed report on all of his leftover business interests in the DRC, which would then be subject to review by a third-party auditor, according to the NYT. Half of the proceeds of the sale of his mining interests would be held in escrow while the audit is conducted, and any assets that Gertler may attempt to hide would be confiscated by the Congolese government.

Gertler would also need to drop lawsuits against Congolese human rights activists who have criticized him, and the sanctions would go back into effect if he is accused of corrupt activity again, according to the NYT.

“The Biden administration has refused to be transparent about any framework for a deal on this issue or about who is guiding the policy,” Republican Idaho Sen. Jim Risch told the NYT in a statement. “The critical question is: What prevents Gertler definitively from just returning to Congo either now or in a future administration?”

The White House referred the Daily Caller News Foundation to the State Department and the Treasury Department, neither of which responded immediately to requests for comment. The DCNF attempted to contact Gertler through his personal website, and also contacted the three companies involved in the reported deal between the U.S. and Gertler for comment from him or on his behalf.