Harmony Gold Mining Company has settled a claim with the lead plaintiff of a group that claimed the company overstated earnings in 2007. The Johannesburg based Harmony Gold is the third largest producer of gold in Africa and the fifth largest producer of the precious metal in the world.
The class action was filed in the U.S. District Court for the Southern District of New York in May 2008. Schiffrin Barroway Topaz & Kessler filed the lawsuit on the behalf of buyers and sellers of the Harmony securities. Current Chief Executive Officer Graham Briggs of Harmony Gold Mining said that a mediated settlement process was followed to avoid protracted and expensive litigation.
Former Chief Executive Officer Bernard Swanepoel and Financial Director Nomfundo Qangule resigned in 2008 after the company said it overlooked about 250 million rand which is approximately $35 million worth of costs
Marian van der Walt, a spokeswoman for the company said that the settlement was a reasonable amount with which they were comfortable. The investor relations executive maintained that the company did not act wrongly and would not admit to any liability.
She added that as soon as they discovered the error in the financial system during the stated period, it was immediately disclosed to the market. The settlement will get its final approval from the court in a scheduled hearing due on November 10. If the settlement is approved it will result in the dismissal of all claims against the company.