News Wrap

IN THIS morning’s News Wrap: IMF’s McLernon mulls Rio class action after fraud charges; Bounty beats field to buy Caledon coalmine; and Rio holds talks with Indonesia about exit from Grasberg.

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IMF’s McLernon mulls Rio class action after fraud charges

Class action pioneer Hugh McLernon is examining a potential litigation by Rio Tinto shareholders against former directors Tom Albanese and Guy Elliott on the back of a US prosecution launched this week, reports the West Australian.

McLernon, the head of litigation funder Bentham IMF, said Albanese and Elliott likely had significant professional indemnity insurance policies that could be claimed against on the strength of Securities and Exchange Commission court allegations.

McLernon said that if the Rio board did not take legal action against the former directors based on the allegations, shareholders could sue on the company’s behalf....

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