Rio Tinto Aftermath: Why It’s A Good Idea To Wait For (Written) Verdicts

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Bribe-taking among Rio Tinto’s Shanghai iron ore executives was more extensive than previously thought and may have undermined the company’s revenue, court documents show.

Judge Liu Xin’s written verdict in the trial of Australian Stern Hu and three Chinese colleagues lays out in forensic detail how they sought, received and sometimes laundered huge personal gains.

John Garnaut’s recent article in The Age, which discloses details of the Stern Hu judgment, is instructive on several levels. The Rio Tinto bribery case received a great deal of attention abroad, and many commentators not only jumped to certain conclusions, but also conflated several issues into a damning indictment of the Chinese criminal justice system.

From the initial arrests to the verdict, commentary covered a lot of areas, including the following questions:

1. Was China’s criminal procedure being followed in this case?

2. Was there selective prosecution against Rio as punishment for tough negotiation tactics?

3. Were Stern Hu and the other Rio employees innocent pawns?

4. Were there any violations of international law?

5. Were the verdicts unnecessarily harsh?

What seemed to happen over time is that criticisms in one or more of these areas tended to be conflated with other topics. For example, there were excellent articles written by legal experts like Jerome Cohen on the issues of criminal procedure and international treaty law. Serious problems were identified.

Unfortunately, others took that criticism as evidence that the entire case was made up out of whole cloth by a vengeful steel industry and their central government handlers. This of course fed into a pre-existing theme of a totalitarian State in the midst of “re-nationalizing” and marginalizing the power of foreign enterprises in China.

The reality, of course, is that while criminal procedures may not have been followed and political influence over the process could have been involved, these guys appear to have not only done the deeds, but also deserved the verdicts given.

[T]he discussion of bribery is damning. Huge sums of cash were stored in third party bank accounts – with the bribe-takers given cash cards – or directly handed over in dark green plastic shopping bags and cardboard boxes.

The cash transactions took place in hotels, airports, casinos, nightclubs and even a restaurant in the office tower where Rio Tinto has its Shanghai headquarters.

Garnaut’s article contains more details. It’s difficult not to take away one lesson from all the uproar over this case: guilt or innocence should always be separated from discussions of procedural matters or politics. At the same time, one can be highly critical of a criminal justice system and yet not be advocating on behalf of a certain individual.

Maybe these distinctions are too fine to be dealt with by major news outlets that have limited time and resources, and the next time a big case comes around, the same mistakes will be made. But maybe not. I can hope.