From Washington to Kinshasa, Dan Gertler’s survival operation

By Mathieu Olivier, Romain Gras, Special correspondent in Tel-Aviv
Posted on Friday, 26 August 2022 11:53

The agreement between the DRC and the Ventora group, owned by businessman Dan Gertler, was signed on 24 February 2022.

These days things are not going so well for the mining magnate: he is still under sanctions, Kabila has left power, the Biden administration does not appreciate him... However, since February 2022, he has concluded an agreement with the Congolese government. Will he manage to bounce back? Read on in the last episode of our series.

This is part 4 of a 4-part series

On 21 December 2017, night fell on Tel Aviv, and Dan Gertler was unreachable. Outside the synagogue that he is used to frequenting, cameras and journalists were waiting patiently to see him. The tycoon did not know it yet, but the knife had fallen. 19 of his companies and his right-hand man, Pieter Deboutte, who manages his business in Congo, had just been included in a first wave of sanctions in which he was the main target.

The US Treasury accused him of “using his friendship with Joseph Kabila to broker the sale of mining assets in the DRC, forcing certain multinationals to go through him.”

“Dan [Gertler] did not understand what was going on and did not measure the impact that these sanctions could have,” says one of his associates.

I was often told that all these reports were bad for my image, but I didn’t pay attention to them

These restrictive measures went far beyond a simple freeze on assets. They prohibit American individuals or companies from carrying out transactions with the targeted personalities. In concrete terms, Gertler is banned from the American banking system, and forbidden from trading in dollars, the leading currency in Kinshasa.

“These sanctions work a bit like a cluster bomb,” says a Congolese mining sector executive. In June 2018, 14 new entities controlled or owned by the Israeli businessman were added to the Office of Foreign Assets Control (OFAC) list.

Gertler insists he did not see this coming. After 20 years of rubbing shoulders with the powerful, did he think he was safe? “He thought that the United States would be more grateful for what he was able to do in the early 2000s,” says one of his relatives.

Israel’s interests in Central Africa

Gertler was probably also surprised when, in January 2019, the Constitutional Court confirmed the victory of Félix Tshisekedi. The Israeli was now deprived of Kabila, his main contact at the top of the state. In reality, the beginning of Tshisekedi’s mandate did not change things, because he pursued a twofold strategy: to get closer to the US, which wanted to dismantle the Kabila system, and to appease his predecessor, who still controlled the majority.

The businessman therefore continued to travel regularly to Kinshasa, where he sometimes met Kabila. In 2019, he was introduced to Tshisekedi and made initial contacts in his entourage.

“I have never heard our American friends tell us that he was so bad that we should not let him do business in the DRC,” the Congolese head of state said in September of the same year.

With the US sanctions, a real “survival operation ” began. On 17 October 2018, the billionaire hired the lawyer Alan Dershowitz, who is close to President Donald Trump, and Louis Freeh, who was FBI director under Bill Clinton.

Gertler was also supported by the law firm of Arnold and Porter and received the more informal support of a list of personalities that is as impressive as it is unexpected. Among them was Yossi Cohen, boss of the Mossad (2016-2021).

According to the American media company Bloomberg, the latter, together with Ron Dermer, the former Israeli ambassador to Washington, spoke to several American officials and stressed the importance of Gertler’s network in Africa for Israel. Gertler is also close to former Israeli minister Avigdor Lieberman. Though some of our interlocutors emphasised the unofficial role that the tycoon plays in favour of his country’s interests in Central Africa, Gertler himself did not wish to comment.

The benevolence of Donald Trump

In a letter dated 13 November 2019, which we were able to consult, Jendayi Frazer, President Bush’s former deputy secretary of state, underlines the role played by the billionaire in the Sun City agreements and in favour of American diplomacy in the Congo in the early 2000s.

The lobbying eventually paid off. On 15 January 2021, six days before he left the White House, Donald Trump granted Dan Gertler a provisional licence for one year, allowing him to access his dollar accounts and resume some of his activities.

Less than two months later, the new US administration revoked it, saying it was “contrary to US policy to combat corruption and promote stability in the DRC.” “The Biden administration is obsessed with Gertler,” says a Washington-based lobbyist familiar with the DRC.

According to a document that we were able to consult, the businessman nevertheless still has a permit that is supposed to allow him to finance charitable activities under certain conditions and through pre-identified financial channels. In force from 12 January 2021, it expires on 31 January 2023. According to those close to Gertler, it has not been used until now.

‘The truth will eventually triumph’

The billionaire’s situation in the DRC is not much better. In July 2020, thanks to two whistleblowers, Global Witness and the Platform for the Protection of Whistleblowers in Africa (PPLAF) accused Gertler of having set up – with the complicity of the bank Afriland and several agents – a vast money laundering network in order to circumvent sanctions.

[…] the DRC finds itself reimbursing expenses that have not been independently certified

“I was often told that all these reports were bad for my image, but I didn’t pay attention to them,” says Gertler, who disputes these accusations. “The truth will eventually triumph,” he says.

In the weeks following the publication of the report, he nevertheless organised a riposte. Through his entourage, he contacted several Parisian communication firms. He also counter-attacked on the judicial level, by filing several defamation suits against the authors of the investigation, who, for their part, reported being pressured before the report was published.

This change of strategy to improve his image took concrete form on 16 November 2020 with the announcement of a project in which he invited “his Congolese brothers and sisters” to enjoy the benefits of the mining industry by taking shares in the royalties of the Metalkol project, which he had quietly acquired in 2017.

Immediately condemned by civil society, the initiative failed. On 6 December 2021, nine months after the sanctions were reinstated, the 12 companies targeted in the Global Witness investigation, as well as one of Gertler’s associates accused of helping him circumvent the sanctions, were added to OFAC’s list.

Reputation and royalties

Gertler seems more cornered than ever. All the more so as for several months, in Kinshasa, Tshisekedi has been working to overturn the majority held by Kabila. At the instigation of the US, anxious to counter the influence of China, the president announced – in May 2021 – his intention to renegotiate the mining contracts signed under the reign of his predecessor.

A month later, the Congolese state did not renew the Caprikat and Foxwhelp oil licences on Lake Albert, accusing these two companies, linked to Gertler, of not having respected their commitments. The Israeli defended himself and claimed, with an audit to back it up, that he had already invested €130m ($128.9m) in the project. The dispute led to an arbitration procedure before the International Chamber of Commerce in Paris, where the DRC claimed compensation of more than $150m from the billionaire’s companies.

This procedure never came to fruition. Living up to the secrecy that has been his trademark for the past 25 years, Gertler finally reappeared at the Congolese presidency on 24 February 2022. For more than a month, he had been privately negotiating a memorandum of understanding with the help of a small group of advisors to the presidency. The former boss of Gécamines, Albert Yuma, was consulted during these discussions.

This deal has not yet been made public. However several of its clauses, presented to various civil society groups, are known. The agreement provides for the return to the Congolese state of three mining deposits still belonging to Gertler and the two Lake Albert permits, which are at the heart of the arbitration procedure, and which the DRC has agreed to waive in return, reimbursing the costs invested by Caprikat and Foxwhelp.

“We were not at the origin of these negotiations, and I am convinced that we would have won the arbitration,” the businessman says, believing that the DRC is the “winner” of such an agreement.

“The parties have agreed that the agreement puts an end to any dispute between them and that they no longer have any pending claims against each other,” the billionaire’s camp tells us at this stage.

“These permits were not renewed in June 2021, and the DRC should have recovered them free of charge, but today the DRC finds itself reimbursing expenses that have not been independently certified,” says Jean-Pierre Okenda, director of the Extractive Industries Department at the NGO Resource Matters.

Signing of an amicable agreement between the DRC and the Ventora group, owned by businessman Dan Gertler (3rd from left), on 24 February 2022.
Signing of an amicable agreement between the DRC and the Ventora group, owned by businessman Dan Gertler (3rd from left), on 24 February 2022.

In addition to compensation, which has not yet been paid, two other clauses have angered some civil society groups: Gertler’s right to continue to receive royalties on three major mining projects (a reimbursement to the DRC of part of those received on the Kamoto Copper Company – KCC – project is nonetheless provided for) and the DRC’s commitment to work, “with no guarantee of success”, towards lifting US sanctions.

“For Gertler, the royalties are money he can collect immediately, whereas before the DRC can collect any profits, it will have to develop assets whose real value is unknown,” says Emmanuel Umpula, a researcher at Africa Resource Watch.

The issue of royalties is far from trivial. According to the Gécamines audit published in June 2022 by the General Inspectorate of Finance, for the period between 2015 and 2020 alone, the transfer of royalties in the KCC project earned Gertler more than $87m.

An “amount that could have benefited Gécamines”, according to the agency, which stresses that according to the national mining company, this transfer was “economically justified”.

The agreement caused tensions, both within civil society – some supported it, believing that it benefited the DRC – and within the executive and cabinet. Although it was ultimately signed by Rose Mutombo, the minister of justice, it was in fact negotiated by a commission headed by André Wameso, Félix Tshisekedi’s deputy cabinet director, who defended the legality of Gertler’s acquisition of these royalties.

The secrecy with which this agreement was drawn up has caused unease among some advisers and ministers, who are worried about the consequences it could have on relations with Washington.

“The real issues for Dan Gertler are the lifting of sanctions, his reputation and the royalties he has fraudulently acquired. For the DRC, it is very risky to go through with this agreement,” says Okenda.

Will he win his case?

Aware of the resistance that the agreement is facing, the billionaire is struggling to finalise the details. In mid-March 2022, according to our information, he sent a large delegation to Kinshasa.

Housed at the Fleuve Congo Hotel, it was led by one of his sisters and was supposed to finalise the agreement on his behalf. Almost at the same time, a delegation from the US Treasury also went to Kinshasa to request, in vain, a version of the deal. After several requests, Washington, according to several Congolese official sources, obtained a copy of the agreement a few weeks ago. “The US Treasury is currently analysing its content,” says a person close to the Congolese president who is following the case.

For the United States, no deal with Gertler is acceptable

Will Gertler get his way? In recent weeks, he has found reason to believe so. On 25 May, the day we met in Tel Aviv, Glencore announced that it had reached an agreement with the US Department of Justice after pleading guilty to corruption in various contracts in Africa and Latin America. Two other cases, in Britain and Brazil, reached the same conclusion without charges being brought against Gertler. However, two cases are still ongoing in Switzerland and the Netherlands.

However, while some of Gertler’s partners are – or have been – the subject of international investigations, there are concerns in civil society about the impact this agreement could have on any subsequent claims for compensation that the DRC may make.

Discontent in Washington

However, Gertler’s main constraint remains, as the sanctions prohibit the Congolese government from compensating him in dollars.

“We are going to rely on the case of Glencore, which has been paying Gertler royalties in euros since 2018,” says a person close to Tshisekedi who is involved in the case. “Nothing prevents us from paying him in a currency other than the dollar.”

“As far as sanctions are concerned, our commitment does not guarantee a result. We have simply told the Americans that the DRC no longer has a problem with Dan Gertler,” says our source.

A message that has difficulty getting through in Washington. “For the United States, no deal with Gertler is acceptable,” says a former senior US official. If this deal were to go into effect, the consequences would be diplomatically damaging.

Understand Africa's tomorrow... today

We believe that Africa is poorly represented, and badly under-estimated. Beyond the vast opportunity manifest in African markets, we highlight people who make a difference; leaders turning the tide, youth driving change, and an indefatigable business community. That is what we believe will change the continent, and that is what we report on. With hard-hitting investigations, innovative analysis and deep dives into countries and sectors, The Africa Report delivers the insight you need.

View subscription options