SEC says Rio Tinto, two former execs must face fraud charges

|About: Rio Tinto plc (RIO)|By:, SA News Editor

The SEC rejects arguments by Rio Tinto (NYSE:RIO) and two former top executives that its civil lawsuit claiming they concealed the plunging value of the company's coal assets should be dismissed.

The agency maintains its earlier complaint adequately alleged that fraud occurred, and that Rio, former CEO Thomas Albanese and former CFO Guy Elliott intended to deceive investors.

The SEC also rejects Rio’s argument that any alleged misstatements and omissions might be immaterial because the writedown was for only 3% of company assets; it says Rio's net earnings for H1 2012 would have been cut by more than 50% if the company had properly written down the assets.

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