US Congress urged to probe firm’s role in RP terror

WASHINGTON — A former executive who alleged his now defunct Denver-based mining company paid about $2 million to terrorist groups in the southern Philippines in the mid-1990s to buy protection is lobbying the US Congress to ensure a substantial source of funding for terror groups is eliminated.

Allan Laird, former project manager of the Philippine Kingking gold and copper mine then owned by Echo Bay, told The STAR he blew the whistle against Echo Bay not for any personal gain but to ensure US companies operating in problem areas throughout the world do not unwittingly undermine the battle against global terrorism by providing "protection money" to local insurgency groups.

He said although Echo Bay’s aim of protecting its employees was commendable, the way it was done was illegal.

The alleged payment to rebel groups in Mindanao including the Moro Islamic Liberation Front and the Abu Sayyaf, reported to have links with Osama bin Laden’s al-Qaeda network, was publicly aired by Laird in the April issue of Sierra magazine, a publication of the conservation group Sierra Club after US officials declined to act on his information.

Laird said he had been documenting the alleged payoffs to Muslim and communist rebels since he arrived in Mindanao in August 1996 until his departure in September 1997 shortly before Echo Bay abandoned the property and recorded a $50 million loss.

On his return to Denver he gave Robert Leclerc, Echo Bay’s chairman and CEO, a complete report about "inappropriate payments made to terrorist organizations" but it was only after he was laid off in January 2003 that he publicly came out with his allegation.

He said he met with Department of Homeland Security officials who told him they could not pursue the issue because the statute of limitations had lapsed on any possible prosecution.

It was then that the Sierra Club came into the picture and after a two-month investigation of Laird’s charges published the article in April.

The article said Echo Bay in 1995 saw the Philippines, estimated to be second only to South Africa in average gold reserves per square mile, as a jewel and wanted in.

The timing was fortuitous.

"Racked by debt and desperate for foreign investment, the Philippines passed a mining code in 1995 that amounted to a fire sale of the nation’s riches," the article said.

Echo Bay’s technical group argued against going to Kingking saying its complex metallurgy, unstable soils and torrential seasonal rains made the project a losing proposition.

The business side, however, overruled the geologists and engineers and in October 1995 Echo Bay purchased a 75 percent stake in Kingking with the Canadian mining company, Toronto Ventures Inc. (TVI) getting most of the rest.

Benguet Corp. was tied up to a percentage of the project as it went forward for the initial development and exploration of Kingking, in Pantukan, 35 km northeast of Davao City, Laird said.

The property is now owned by Benguet which is trying to find another partner to develop it, Laird added.

In January 2003 Echo Bay was acquired by Toronto-based Kinross Gold Corp. in a $1.9 billion merger.

Asked to comment on charges by former Echo Bay chairman and CEO Robert LeClerc that he tried to extract money after he was laid off following the merger, Laird said "that is absolute rubbish."

"I have no legal or any other claim against the company. I tried to work within the company to get it to release information to the US government concerning its knowledge of terror groups in the Philippines but Echo Bay declined this option," Laird said.

He said after the Sierra magazine article the Justice Department decided to reopen an investigation into his allegation.

"Since then I have met Homeland Security and the FBI and they said they were in the process of writing a report for submission to the Colorado US attorney.