US Judge Says Rio Tinto Must Face SEC Fraud Case

A U.S. judge on Monday rejected Rio Tinto Plc's bid to dismiss a Securities and Exchange Commission lawsuit accusing the Anglo-Australian mining company of civil fraud in its handling of a failed investment in a Mozambique coal project.

U.S. District Judge Analisa Torres in Manhattan said the regulator may pursue some claims in its October 2017 lawsuit against Rio Tinto, former Chief Executive Officer Tom Albanese and former Chief Financial Officer Guy Elliott.

Torres narrowed the main fraud claim against Rio Tinto and Albanese to focus on the former CEO's statements about Mozambique growth prospects, finding no proof they intended to overvalue Rio Tinto Coal Mozambique ("RTCM") by more than US$3 billion.

Albanese and Elliott still face SEC claims that their actions led to the overvaluation appearing in a semi-annual Rio Tinto financial report.