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SEC Fines Brazilian Mining Firm Over Dam Collapse

Brazilian mining company Vale has agreed to pay US$55.9 million to settle charges stemming from the 2019 Brumadinho dam collapse the US Securities and Exchanges Commission (SEC) has announced. Vale had charges brought against it by the SEC last April alleging that the firm had made “false and misleading” disclosures about the safety of its dams prior to the collapse that killed 270 people. The SEC’s complaint alleged that the dam “did not meet internationally-recognised safety standards”, despite Vale’s public sustainability reports assuring investors that all its dams were certified as stable. The settlement, if approved, will require Vale to pay a US$25 million civil penalty and disgorgement and pre-judgment interest of US$30.9 million, as well as permanently restrain and enjoin Vale from violations of the Securities Act of 1933 and of the Securities Exchange Act of 1934. Mark Cave, Associate Director of the SEC’s Division of Enforcement, said: “Today’s settlement will levy a significant financial penalty against Vale and demonstrate that public companies can and should be held accountable for material misrepresentations in their ESG-related disclosures, just as they would for any other material misrepresentations.” 

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