Tesla Uses Company Guilty of Oil Price Manipulation, Bribery, and Corruption for EV Batteries

Tesla cars recharge at a Tesla Supercharger station in Pasadena, Calif., on April 14, 2022. (Mario Tama/Getty Images)

Glencore, a commodities trader and mining firm that is a supplier to Tesla, pleaded guilty on May 24 in connection with a decades-long bribery and corruption scheme stretching across Africa and South America. Separately, the company also admitted to manipulating oil prices.

To settle the charges, Glencore agreed to pay the U.S. government $1.1 billion in fines and forfeitures. The guilty pleas were part of a coordinated resolution with criminal and civil authorities in the United Kingdom, Brazil, and the United States.

Still, the judgment didn’t go far enough for the International Corporate Accountability Roundtable. The coalition stated that the investigation and ruling stopped short of holding Glencore accountable for its most heinous crimes—Glencore stands accused of the worse human rights record among companies working in metals extraction for “green” technologies.

Glencore’s operations supply Tesla as well as several other U.S. companies with cobalt, an essential component in batteries used in electric vehicles (EV).

Protesters display a banner and posters in front of the venue of commodities trader Glencore's annual shareholder meeting in Zug, Switzerland, on May 2, 2018. (Arnd Wiegmann/Reuters)

Tesla assured the public via its 2021 Impact Report, while acknowledging the abuses that might accompany mining, that it goes above and beyond not to use companies engaged in shady business dealings.

“Mining has an important role to play in the transition to sustainable energy and we engage with suppliers to ensure mining is done in a responsible way. ... Tesla joined the Initiative for Responsible Mining Assurance (IRMA) and uses the IRMA Standard as well as other internationally recognized responsible mining standards in our due diligence.”

In its 2019 Impact Report, Tesla publicly stated that “Tesla recognizes the higher risks of human rights issues within cobalt supply chains” and had put in place policies to “remove these risks from our supply chain.”

Despite the assurances, Glencore is one of Tesla’s primary cobalt suppliers, supplying up to 6,000 tons per year for Tesla’s EV batteries.

Glencore and Tesla didn’t respond by press time to requests from The Epoch Times for comment.

Tesla’s Words

In its 2021 Impact Report, Tesla went into impressive detail when discussing its approach to ensuring its suppliers act conscientiously.

“Tesla is committed to ensuring that our suppliers operate responsibly. We do this by proactively identifying and addressing potential risks in our supply chains. The Tesla Supplier Code of Conduct, Human Rights Policy, and Responsible Materials Policy outline Tesla’s expectations for suppliers.”

Specifically, the report states that Tesla collects data on the companies supplying minerals such as cobalt, nickel, and lithium and engages with suppliers to ensure upstanding mining practices among its suppliers.

Tesla CEO Elon Musk speaks before unveiling the Model Y at Tesla's design studio in Hawthorne, Calif., on March 14, 2019. (Jae C. Hong/AP Photo)

Tesla also acknowledged that raw materials are often concentrated in countries that face socio-economic issues, so where possible, Tesla uses direct source mining, which helps to ensure responsible and humane mining conditions. As part of their agreement with Tesla, the mines agree to binding contracts with environmental and social requirements.

Not happy with stopping there, Tesla also stated that 83 percent of its refiners and mine sites, plus 100 percent of refiners from whom Tesla sources directly, undergo or are in the process of “independent external sustainability audits.”

These audits confirm that each company meets good practice initiatives set by organizations such as the Initiative for Responsible Mining Assurance.

According to its 2021 Impact Report, Glencore has completed all required audits and assessments.

Corruption and Human Rights Abuse

Glencore’s May 24 entanglement with the law is but an instance in a long list of purported double-dealings and corruption allegations dating back 20 years.

For example, in 2012, environmental justice and human rights organization Global Witness began examining the links between Glencore and corruption in Congo mining deals. It found that Glencore used Israeli billionaire Dan Gertler’s relationship with then-Democratic Republic of Congo (DRC) President Joseph Kabila for favorable mining deals.

“Glencore pumped cash, loans, and shares worth over half a billion dollars into offshore companies owned by Gertler, which allowed him to make at least $67 million in risk-free profit.”

In 2017, the offshore law firm Appleby found itself in the news after hackers leaked to reporters more than 13.4 million confidential electronic documents related to offshore investments.

Artisanal miners collect gravel from the Lukushi river searching for cassiterite in Manono in the Democratic Republic of Congo, on Feb. 17, 2022. (Junior Kannah/AFP via Getty Images)

Among other things, the “Paradise Papers,” similar to Global Witness, asserted that Glencore used Gertler to negotiate mining rights deals in the DRC.

Later in 2017, the U.S. Treasury Department sanctioned Gertler over allegations of using his relationship with Kabila for favorable DRC mining asset sales.

In 2018, IndustriALL, a global union representing 50 million mining and energy workers in 140 countries, launched an investigation into widespread human rights abuses at Glencore’s mining operations. When officials tried to meet with local unions at Glencore mines, the company denied them access and threatened arrest.

In 2019, a case study by Environmental Justice Atlas alleged that Glencore engaged in forced child labor, tax evasion, and water pollution via its subsidiaries in the DRC. The case is still “in operation.”

A child walks past a truck carrying rocks extracted from a cobalt mine at a copper quarry and cobalt pit in Lubumbashi, Democratic Republic of the Congo, on May 23, 2016. (Junior Kannah/AFP via Getty Images)

In its 2021 Transition Minerals Tracker analysis, the human rights organization Business and Human Rights Resource Centre stated regarding companies involved in the transition to “net zero” via mineral extraction, “Globally, Glencore has the worst record.”

“It was the company linked to the highest number of [human rights abuse] allegations in Africa, the second-highest in Asia-Pacific, and third-highest in South America.”

Perhaps most condemningly, however, is what the U.S. Justice Department said after Glencore pleaded guilty to the corruption, bribery, and market manipulation charges.

“In the foreign bribery case, Glencore International A.G. and its subsidiaries bribed corrupt intermediaries and foreign officials in seven countries for over a decade. In the commodity price manipulation scheme, Glencore Ltd. undermined public confidence by creating the false appearance of supply and demand to manipulate oil prices.”

Tesla's Model Y line during the start of the production at the company's "Gigafactory," on March 22, 2022. (Patrick Pleul/Pool/AFP via Getty Images)

U.S. Attorney Damian Williams for the Southern District of New York added: “The scope of this criminal bribery scheme is staggering. Glencore paid bribes to secure oil contracts. Glencore paid bribes to avoid government audits. Glencore bribed judges to make lawsuits disappear. At bottom, Glencore paid bribes to make money—hundreds of millions of dollars. And it did so with the approval, and even encouragement, of its top executives.”

The allegations, admissions of guilt, and the fact that agencies have pointed to Glencore’s corruption and human rights abuses for 20 years conflict with Tesla’s statement that it goes to great lengths to ensure responsibly sourced minerals.