West Virginia Gov. Jim Justice is personally liable for around $700 million in loans that the collapsed financial firm Greensill Capital made to his coal companies, according to a report.
Justice and his wife guaranteed the loans from Greensill to his coal businesses, the Wall Street Journal reported, citing people familiar with the issue and documents.
Greensill, which collapsed into bankruptcy in March, had packaged the loans and sold them to Credit Suisse, The Journal reported. Now, Credit Suisse is in talks with Justice’s Bluestone Resources and other major borrowers from Greensill to recoup the money and repay investors, per The Journal.
The Swiss bank told investors in a recent notice that Bluestone owes nearly $700 million, the WSJ reported.
Bluestone said in a lawsuit brought in March that it had not expected to start repaying the loans until at least 2023.
The personal liability of Justice, who has been governor of West Virginia since 2017 and is a Republican, adds to his financial pressures. Forbes knocked the politician and businessman off its billionaires list earlier this year, due in large part to Greensill’s collapse.
Justice’s companies are also in legal disputes with other companies over payment contracts and coal deliveries, The Journal reported said. They have settled a number of disputes in recent years over alleged non-payment of bills, according to news outlet ProPublica.
Bluestone, Credit Suisse, and a representative for Justice did not immediately respond to requests for comment. Bluestone and Justice’s representatives declined to comment to The Journal.
As well as the guarantees from the governor and his wife, Justice’s son James C. Justice III guaranteed loans up to a certain limit, The Journal reported.
The collapse of Greensill has heaped pressure on Credit Suisse, which is frantically trying to recoup its losses. It said in April that it was focused on three main borrowers: Bluestone, British-Indian steel magnate Sanjeev Gupta’s GFG Alliance, and SoftBank-backed construction company Katerra.
It’s been six years since the world’s governments adopted the Paris Agreement. But in many parts of the world, including my country of Indonesia, the coal industry rampages on, aided and abetted by banks from around the world.
As important as political action is on climate change, banks must end their financing of coal too. Through their lending and investing activities, many banks are funding companies opening new coal mines and building new coal power plants, despite the UN saying that all new coal projects should be cancelled immediately to meet climate goals. If financial institutions phased out funding for coal-dependent companies, the transition from polluting power to clean would be vastly accelerated.
But one major UK bank has escaped scrutiny for its poor coal policies: Standard Chartered.
Best known for sponsoring Liverpool FC, Standard Chartered is a major bank in Asia. It’s climate policy allows them to continue pumping billions into destructive coal companies, including in Indonesia.
Despite the bank’s internal analysis showing that Adaro’s business plans are in line with 5-6°C of global warming, it has decided to support Adaro anyway. Adaro is a major supplier of coal to Europe, Asia and America. It controls at least 31,380 hectares of land, an area bigger than Birmingham, producing 54 million tonnes of coal in 2020 alone.
Adaro estimates its coal reserves at 1.1 billion tonnes. Burning all of these reserves – as Adaro intends to do – would release 2.2 billion tonnes of CO2-e, almost the equivalent of the annual emissions of India. The company has no plans to produce any less coal. And yet, Standard Chartered continues to fund Adaro, whose business plan is consistent with the Paris Agreement failing.
Adaro coal mining operations tear down forests, degrading the land. Early this year, at least 24 people were killed, and more than 113,000 people were displaced due to a massive flood in South Kalimantan, on the island of Borneo. The immense suffering from the floods has been linked to degraded land in the water catchment area. Adaro is one of the mining companies that operate its coal mines near the river catchment area.
So Standard Chartered isn’t just funding a perennial coal mining company. It’s funding a company building new dirty coal power plants. And yes, we’re talking about a UK bank in the year 2021.
Standard Chartered’s slogan, “Here For Good”, means nothing if it means continuing to provide hundreds of millions to a company ripping the heart out of communities in my country and making global climate change worse.
Binbin Mariana is an energy finance campaigner living in Indonesia, campaigning with environmental group Market Forces. A former banker, she believes that financial institutions must stop contributing to the climate crisis.