Mongolia refuses to let Rio’s Aussie lawyer leave

Mongolia believes China is tightfisted

A 32-year-old Australian lawyer for a Rio Tinto (ASX:RIO) subsidiary has been prevented from leaving Mongolia by local law enforcement following allegations of corruption.

The Australian reports that Sarah Armstrong, chief lawyer for Rio subsidiary SouthGobi Resources (TSX:SGQ), has been held by the Mongolian authorities to provide testimony in a corruption and money-laundering case.

According to the Herald Sun the Australian national was stopped by members of local law enforcement at Ulaanbaatar’s airport on Friday while attempting to leave the country for Hong Kong.

In an interview with ABC News Australian foreign minister Bob Carr said Ms. Armstrong has not been detained or arrested and that she retains her passport. According to Carr the corruption case does not involve any allegations against Armstrong herself, and the authorities only require her to serve as a witness.

Some of Armstrong’s colleagues claim, however, that Armstrong is being targeted as a result of allegations of corruption she recently raised against government officials.

Armstrong signed a complaint against the Mongolian government four months ago, and is expected to be interviewed by authorities either today or tomorrow.

The incident arrives just following increased intervention by the Mongolian government in the mining interests of foreign investors, with Turquoise Hill Resources (NYSE:TRQ), another Rio subsidiary, receiving a letter from the government earlier this month requesting renegotiation of its ownership of the Oyu Tolgoi copper and gold mine.

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