Somiphos under scrutiny for ties with Amit Gupta who bribed former officials

Somiphos, Algeria’s government-operated phosphate mining enterprise, and Amit Gupta, the proprietor of Agrifields DMCC, a Dubai-based company specializing in fertilizer and phosphate trading, are two distinct entities in the industry.

According to Sydney Morning Heralds’ award-winning investigative journalist Nick McKenzie, Amit Gupta is an “alleged corporate crime kingpin and fugitive from justice” who “has built a global business worth an estimated $800 million.” McKenzie further claims that Gupta “had backed a political coup on the small Pacific island of Nauru by bribing multiple politicians who had plotted to topple the government.”

In 2020, “the AFP moved to seize multiple properties and bank accounts connected to Gupta in Australia, Singapore and New York worth an estimated $200 million.” In 2023, Gupta faced an attempted extradition by the Australian government and is currently subject to a global travel ban due to an Interpol Red Notice. As a result, Gupta is unable to leave his base in Dubai.

Nick McKenzie says “Banking records suggest Gupta’s companies also paid suspected bribes to senior Algerian officials for mining concessions in Africa”.

The Somiphos Scandal:

Amit Gupta has significant business connections with Somiphos, also referred to as Société Des Mines De Phosphate or Ferphos, in Algeria. This association is highlighted by the recent revelations. Somiphos, the state-owned phosphate enterprise, predominantly conducts its business through Gupta’s company, Agrifields DMCC.

What is particularly concerning is how a state-owned entity engages with an individual under criminal investigation for bribery, involving high-level officials such as the former President, the justice minister, and the current President of Nauru, as reported by ABC.

Additionally, Amit Gupta faces various charges, including money laundering, fraud, account manipulation, and forgery, as investigated by both the Australian Federal Police and Indian authorities.

“The US documents name Getax director Amit Gupta as the ‘target of a criminal investigation who is alleged to have conspired with others to bribe foreign public officials and to have engaged in money laundering and other offences’.” and that “In 2018, Singaporean anti-corruption authorities fined Getax Singapore S$80,000 for bribery”, according to the Sydney Morning Herald.

Nevertheless, the Somiphos scandal extends far beyond this. Click the text to access the referenced documents for further details.

Amit Gupta’s previous firm, Getax, was acquiring around 600,000 tonnes of rock phosphate from Somiphos each year. These purchases were made at substantial discounts compared to market prices, potentially costing the Algerian state-owned enterprise hundreds of millions of dollars throughout their dealings. How did Gupta manage this? It is suspected he employed the same tactics alleged in Nauru—bribing public officials and employees..

Let us pay a closer look into the details of the Somiphos Scandal through newly unveiled documents:

#1 Bribed official: Amara Charaf-Eddine

Position: Ferphos/Somiphos Director of Development

Details: Getax had paid fees of around $1 per tonne to the Ferphos/Somiphos Director. Amara is now the Chairman of Madar Holding and President of UNEP.

Banking records: Banking records show a Gupta-controlled entity paying US$53,019.36 on 13th November 2009 from its ABN Amro bank account to Mr. Amara Charaf-Eddine and another banking record shows US$50,000 transferred to him on 20th January 2010, for “consultation fees” and “payment against vessel of Khadiza Jahan” respectively to Charaf-Eddine’s beneficiary account /152475877270 at HSBC Singapore.

(View Amara confirming bank details on email) & (View 2 Amara bribe transfers)

The entity that paid the money is Hi-Tech and it’s signatory and controller is Amit Gupta, as per its company records.

(View signatory document)

Email records show the compensation structure for Charaf-Eddine being accepted by Getax officials as follows:

Monthly payment of US$5000

All travel, lodging, and entertainment costs are covered.

US$1 per tone in success fees, translating to approximately US$600,000 a year.

(View email of Getax accepting Charaf-Eddine bribery structure)

An email record shows Mr. Charaf Eddine working to advance the Gupta’s interests, by giving them strategic advice to ensure that his exclusivity remains in place, including wanting to find a solution that is “convenient to Getax and protects (Mr. Z) as well. (We need him inside)”, and to write a letter to “Ferphos/Somiphos” and to “Mention that Getax can go Legal” to which Charaf-Eddine goes onto say, “The Minister will react” and that “Ferphos don’t like legal procedures. They will react positively”, ensuring Getax gets the “best price” and “preferential treatment”, according to Mr. Charaf Eddine’s own words. (View Charaf-Eddine’s email).

#2 Bribed official: Lakhdar Mebarki

Position: Former President/CEO of Ferphos/Somiphos.

Banking records: Banking records show Getax Australia Pty Ltd paid US$56,500 on 4th December 2007 to Lakhdar Mebarki. Furthermore, Lakhdhar accepted kick-backs in the name of his brother Salim Mebarki and a lady named Svitlana Mebarki, under various descriptions including commissions and market introduction fees for rock phosphate. The banking records show US$1 per tone being paid, which translates to US$600,000 annually. Some bank transfers obtained show at least US$300,000 (in a mix of currencies of USD, AUD and EUR) paid in kickbacks between 4th December 2007 and 27th January 2009  directly from Getax Australia Pty Ltd.

(View 23-pages of Mebarki bribe bank transfers).

#3 Bribed official: Bouraouri Bekhouche

Position: Chief of Commercial of Somiphos/Ferphos

Banking records: Bank transfers show Getax Australia transferred  US$48,000 to Berkhouche on 23rd March 2007 and US$20,000 on 23rd July 2007. Berkhouche also received US$0.5 per tonne in kickbacks, translating to US$300,000/annually.

(View Berkhouche two bribe transfers)

Berkhouche also emailed Getax officials to direct payments to his USD bank at Bank of New York and his EUR account at Fortis Bank in Brussels.

(View Berkhouche email)

According to the Australian Broadcasting Corporation (ABC), when “the world price rose to almost $400 in 2008, Getax was paying as little as $43 per metric tonne.” This would likely be enabled through its channels of bribing senior officials in Somiphos/Ferphos.

On that basis, this would have cost the state-government and thus taxpayers of Algeria, shipping 600,000 tones, up to US$214.2 million, in earnings, in 2008 alone, or 28.683 billion Algerian Dinars.

The relationship between the Gupta’s and Somiphos has stretched nearly two decades, and is now conducted through Agrifields DMCC and Agrifields FZE, two entities owned and controlled by Amit Gupta.

According to Sydney Morning Herald, “Agrifields DMCC” is “the name of the global fertiliser firm  Gupta launched after fleeing Australia.”

This year alone, in under 8-months, Indian customs documents obtained shows that Agrifields shipped at least 364,210 metric tones from Somiphos Algeria to India. This brings in, at least, 7.5 billion Algerian dinars in sales for Gupta.

(View shipment documents here)

The actual total is probably greater than this estimate, as his company is known to ship to additional ports.

The long-standing connection between Amit Gupta and Somiphos/Ferphos raises serious concerns about the company’s integrity.

Despite Gupta’s well-documented legal troubles, which include various criminal charges such as bribery and corruption, Somiphos continues to engage with him. This persistent relationship not only compromises ethical standards but also indicates a concerning lack of transparency and accountability in the management of state-owned assets.