As he lay on his death bed in 2008, the former president of Guinea Lansana Conté agreed to hand over a licence worth billions of pounds to mine a share of Simandou, one of the world’s richest undeveloped mineral deposits.

The rights to extract half of the iron ore at Simandou, situated in a mountainous region of Guinea’s south-east, were unceremoniously stripped from Rio Tinto, and awarded to BSG Resources, a mining company based in the offshore haven of Guernsey, a British Crown dependency, whose owner (through a family trust) is Israeli diamond magnate Beny Steinmetz.

Having pledged to invest just $165m to develop a mine at Simandou to secure the rights, BSGR sold a 51 per cent stake in it to Brazilian company Vale for $2.5bn, according to Forbes.BSGR had pulled off the deal of the century, in one observer’s words.

In January this year, the FBI began to investigate the deal. Wire-tapping and a sting led to allegations that Mamadie Touré, Mr Conté’s wife, had received payments into US-held bank accounts, from Frederic Cilins, an agent for BSGR in Guinea.

FBI agents also allegedly found that the Frenchman, Mr Cilins, had put pressure on Touré to destroy evidence showing that the rights to the Simandou mine had been won after millions of dollars were paid in bribes to Guinea government officials. Touré is now co-operating with the investigation in the hope of obtaining immunity for her own potential criminal conduct, according to a criminal complaint filed in federal court in New York in April.

In May, after Mr Cilins was charged with obstructing the federal grand jury investigation, BSGR released a statement acknowledging that it had once had a business relationship with the Frenchman, but adding: “Allegations that there was anything improper about the manner in which BSGR obtained its mining rights in Guinea are entirely baseless and motivated by a campaign to seize the assets of BSGR.”

Alpha Condé, the current President of Guinea, who came to power in 2010 after half a century in opposition, now wants the Simandou licence back in Guinea. He hopes the US criminal case will help his effort to retrieve it.

“I have to wait for the findings of investigations by both the US judicial system and the Guinea system, before I can act or have an informed opinion,” President Condé told The Independent. “The evidence suggests there is a strong case. The US [is] saying that the evidence of corruption is strong.”

President Condé, who is attending the G8 summit as a guest of David Cameron, argues that the British authorities have a role to play in raising the pressure on Mr Steinmetz to return the licence. Transactions went through the UK as well as US banking systems, and he is understood to be pushing for the Serious Fraud Office to start an investigation. Mr Condé – who is being advised by Tony Blair and George Soros on how to curb corruption, build the country’s economy, and enact a “national transformation” – believes that the Simandou scandal has its roots in Western countries, and they must play a key role in holding guilty parties to account.

“Cooperation from the US has already brought a lot of evidence forward,” said Mr Condé. “But England is central because a lot of the transactions will be initiated there. So getting the UK government to provide us with information will accelerate the current investigation.”

Mr Condé says greater exchange of information about offshore assets and companies between Western and African countries will boost the fight against Guinean corruption.

“We are trying to address a problem that has its source in Western countries,” Mr Condé says. “We need to deal with places where the problem arises. Most of the countries involved in the corruption in Guinea and more widely in Africa are of Western origin so the West has to be part of the solution. It is not that we are relying on Western countries to solve our problem, it is that we want Western countries to be part of the solution.”

Offshore companies need to be better monitored and controlled, he says. “We don’t have the technology to identify the problems but this is the very way that corruption is perpetrated.”

As Mr Blair helps Mr Condé with “bringing in technical expertise and the human resources that we are lacking”, Mr Soros – the Hungarian currency trader and hedge fund owner, whose Open Society Foundations has devoted funds to the legal case against BSGR – is pushing for clear-cut licensing procedures in Guinea’s natural resources sector. “He provides the means and the tools to go through with that process of transformation, to bring about good governance, especially within the extractive minerals field. He understands that the challenge is great and it requires a lot of capacity and technical expertise,” Mr Condé said.

In 2010, Mr Condé, who is 75, was declared winner of Guinea’s first democratic election since the country gained independence from France in 1958, taking over from a military junta which had seized power in 2008 after Mr Conté’s death. Having endured jail time and exile during his years in opposition, supporters of his Rally of Guinean People party saw the win as a triumph, but in less than a year he faced a coup from which he narrowly escaped with his life.

Critics have claimed Mr Condé has attempted to rig subsequent elections, including a legislative election which had been scheduled for 30 June, but was postponed. Elements of the military deeply opposed to Mr Condé are said to be fomenting unrest in the capital of Conakry – fuelled by deep ethnic divisions. More than 50 people have been killed during protests in the past three months.

“The President wants these elections to be credible, so he has a problem if the opposition behave in this way,” says Scott Horton, a legal adviser to the Government of Guinea.

Military cost-cutting, prompted by agreements Mr Condé has made with the IMF as part of a deal to rein back on the country’s debt, has trimmed the budget deficit but caused dissension in the army’s ranks. He says he has cut the military’s share of the budget from 40 per cent to 10 per cent, which led to the sacking of some 4,000 soldiers (of a total of 20,000). “We now have a republican army, whose job is to defend our borders, not to police the streets and cause unrest,” he says.

Fundamentalist Islamic groups have also been infiltrating Guinea from neighbouring Mali, where French forces intervened to combat such groups in January. Organised gangs, arms traders and drug dealers have fed on the country’s instability.

‘We have failed to address the needs of the people,” says Mr Condé, who blames such criminality on government failures to tackle social inequalities. “Islamic organisations have been more present than government. They are there every day with people, providing the network and welfare assistance.” Mass unemployment among young people is a further threat to the country’s stability. Mr Condé says it is this young population that offers Guinea’s best hope of retaining democracy, as they are “more intellectual than those in the past and they have the benefit of new technology,” he says. “Dictatorships and other forms of bad governance have been sustained through a lack of knowledge and information. That becomes difficult to maintain in today’s more open and connected world. The youth aspire to be like the rest of the world, and this offers them the best chance.”

Meanwhile, Mr Condé continues to drive the project to begin iron ore production at the part of the Simandou mine Rio Tinto retained. Despite scepticism from many analysts, he insists the $20bn project will begin in 2015.

The project has been debated for months, with sticking points including how a 2011 settlement deal – which ended hostilities between Guinea and Rio Tinto after 2008 – can be combined with an original investment agreement, and how financing for Guinea’s stake in infrastructure will look. Mr Condé is trying to balance the exploration of its resources, while attempting to get a fair deal for Guinea.

“We too face stakeholders – the people who elected us,” he said.

Profile : Benny Steinitz

Born and raised in Israel, the 57-year-old served in the Israeli army after the Yom Kippur War and moved to Belgium in 1978 to run his father’s diamond business, according to Forbes. He eventually became chairman of the Geneva-headquartered Steinmetz Diamond Group, and became founder of another Geneva-based firm, the Beny Steinmetz Group Resources (BSGR), and acts in an advisory role to the board of directors. He is estimated to be worth $4.1bn.

Earlier this month, the former Foreign and Commonwealth Office minister Mark Malloch-Brown and his City PR firm FTI Consulting, which once counted Mr Steinmetz as a client, agreed an out-of-court settlement after Steinmetz alleged that Lord Malloch-Brown had helped run a smear campaign against BSGR over its acquisition of the Simandou iron ore rights. BSGR had accused organisations funded by billionaire financier George Soros of issuing “baseless smears” over its mining investments in Guinea. FTI announced it had paid Mr Steinmetz £76,800, in addition to legal costs, in an out-of-court settlement, but said it was not an admission of liability.