The iron ore lady: Why the world's richest woman is mired in controversy

Mining magnate Gina Rinehart was last month declared the richest woman in the world. But it's the family feuds, attempts to control the Australian media and bitter public disputes that are keeping her in the headlines, reports Tim Hume.

Two years ago this month, the world's richest woman, Gina Rinehart, climbed on a flatbed truck before a hometown crowd in Perth, Australia, and launched herself into public life. The threat of a proposed mining 'super tax', designed to more equitably disperse revenues from Australia's resources boom, had drawn out the usually reclusive iron and coal magnate to address a rally against the government. Dressed in pearls and heels astride a vehicle once owned by her father, the pioneering prospector Lang Hancock, Rinehart bellowed "Axe the tax!" through a megaphone until she was hoarse.

No one who knew Rinehart would ever doubt her passion for her industry, but such a public performance was uncharacteristic. While she had yet to trouble the global rich lists, Rinehart was none the less, by 2010, Australia's wealthiest woman. But despite this, she had managed, until then, to maintain a low public profile.

"When I started the book over a year ago, people would ask, 'Who is Gina Rinehart?'," says Adele Ferguson, an Australian journalist and author of a forthcoming unauthorised biography on Rinehart. But since grabbing the loudhailer, Rinehart has not let go, rising in power and profile to become one of Australia's most talked about and polarising figures: an "Iron Lady" who is a source of intrigue and consternation to the media she increasingly owns, and the political classes she seeks to influence.

Rinehart has no shortage of admirers for the way she has single-mindedly transformed her father's ailing prospecting business into an industrial giant, and helped recast the Outback as a centre of wealth creation.

The bonanza in iron ore, coal and other natural resources in recent years, fuelled largely by the voracious appetites of China and India's growing economies, has buffered Australia better than virtually any other developed economy from the financial crisis.

"She brings a frontier spirit that is reflective of the beginnings of Australia," says writer Tim Humphries, a member of Rinehart's lobby group to develop the country's north, who commends her as a "citizen intent on nation-building".

But her sky-rocketing wealth, significant media acquisitions and fierce right-wing politics have led many to question whether Australia is equipped to handle Rinehart. No less a figure than the Deputy Prime Minister, Wayne Swan, has labelled her a threat to Australia's success, democracy, press freedom and – most gravely – its egalitarianism.

Tasmanian Senator Bob Brown, the recently resigned Australian Greens leader, condemns her as a "selfish, anti-public multi-billionaire", who mounted her father's truck "not to defend the Australian ethos of a fair go, [but] to defend her dividends".

Combined with her toxic legal battle with three of her children over the family fortune, the furore surrounding the 58-year-old widow has seen Rinehart become a household name in Australia.

In February, when she penned an ode to mining that simultaneously celebrated the industry behind Australia's recent prosperity, and championed her pet causes, her straining couplets were reported internationally.

"Develop North Australia, embrace multiculturalism and welcome short-term foreign workers to our shores/ To benefit from the export of our minerals and ores," read the poem, inscribed on a 30-tonne boulder donated by her company, Hancock Prospecting, as a monolithic monument to her industry.

The bulk of Rinehart's fortune has been dug out of the red earth of the Pilbara, a parched, 500,000-square-kilometre region in the north of Western Australia that is home to a mountain range named after her father.

Lang Hancock, whose family had been pastoralists on the land for generations, is credited with discovering the world's largest deposits of iron ore there in the 1950s. Viewed as an industry visionary, Hancock – the "King of the Pilbara" – successfully lobbied the government to overturn its ban on exporting ore. Today, China relies on Australia for nearly half its imports of this key ingredient in steel-making.

But Hancock never realised his dream of owning a mine. On his death in 1992, his business was heavily in debt. The key assets he passed on to his only child, then a 38-year-old widow and mother of four, were royalties on iron ore leases he had transferred to mining giant Rio Tinto. Rinehart has since built a fortune 386 times the size of her inheritance.

In 2007, she opened Hope Downs mine – named after her mother – in equal partnership with Rio Tinto. In 2014, her own – even larger – mine, Roy Hill, is scheduled to begin exports, realising her father's grand, unfulfilled vision for what she refers to as "the House of Hancock".

Last month, Australian business magazine BRW estimated her fortune at AUD$29.2 billion (£18.1 billion), making her the world's richest woman, and eighth richest individual. According to predictions by Citigroup, she has a good chance of overtaking Mexican telecoms giant, Carlos Slim Helu, and Microsoft's Bill Gates at the top of the list, once her projects reach capacity.

Unlike many other moguls, Rinehart owns her companies outright. Moreover, her determination to build her empire only seems to be growing. In the past 12 months, Rinehart has almost tripled her wealth, earning more than £1m every hour.

"Since she embarked on this resurrection of the 'House of Hancock', she hasn't missed a beat," said Tim Treadgold, a Perth-based mining correspondent for Forbes, who has watched Rinehart's rise over the decades. "She's only just started."

Success has given Rinehart clear convictions: as mining has been the making of the Hancocks, so it will prove the making of Australia. Having been groomed as her father's successor from childhood, she sees the world through the industry's prism, and has developed an evangelical view of its role in Australia's destiny.

She also has strong ideas about what the government should do to enable this. Despite being the richest Australian in history, Rinehart wants new laws to allow cheap labour to be imported from overseas, tax breaks for mining, and a special economic zone to encourage development in the country's north.

With an Indian billionaire, Rinehart is developing huge coal projects in Queensland's Galilee Basin, which will produce "more greenhouse gases overseas than the whole of the Queensland economy currently," according to Brown. Rinehart's response to these concerns was to fly out one of the world's most prominent climate-change sceptics, Lord Christopher Monckton, for a speaking tour.

"She sees it all as for the good of the country," says Ferguson. "She believes mining is the most important economic driver, and everything flows from that." Rinehart's political platform is "mono-dimensional and self-interested," says Treadgold. "I don't think there is any appreciation of the damage done by the mining boom, which is not a bed of roses for most Australians." Mining's success has driven the Australian dollar to giddy highs, affecting export industries.

While Rinehart has always had strong political views, it was only once Kevin Rudd's government announced plans for a mining tax – directly threatening her interests – that her lobbying efforts kicked into top gear. "Once she got on that truck, it all started to come together for her," says Ferguson. The campaign was successful: a fortnight after the rally, Rudd was usurped in a coup by Julia Gillard, who declared a compromise with mining chiefs. The resulting tax reaps the government an estimated AUD$10 billion less each year than it might have, while Rinehart's personal wealth has soared, allowing her to explore other means of influence.

In recent years, Rinehart has purchased 10 per cent of the Ten television network and nearly 13 per cent of Fairfax Media, publisher of the Sydney Morning Herald and Melbourne's The Age, making her the single largest shareholder in one of Australia's most powerful media groups.

Rinehart's media forays have prompted protest campaigns by activists, and moved Deputy PM Swan to write a polemic accusing Rinehart and her fellow mining oligarchs of "undermining our equality and threatening our democracy". The essay made front-page news and attracted criticism, but Swan said he stood by his words. "When I see people like Ms Rinehart deploying her huge wealth – gained by selling the non-renewable resources which belong to the entire Australian community – in an attempt to try to stop us spreading the benefits of that natural wealth more fairly across the community, of course I'm going to stand up." (When previously asked to respond to Mr Swan's allegations, Rinehart declined.)

But it's Rinehart's legal actions against a newspaper in her hometown that have raised the biggest red flag. In September, Rinehart's three eldest children moved to topple her as head of a trust controlling about a quarter of the family fortune. They were spurred into action when their mother contacted them the day before the trust was to pay out benefits to tell them the pay-out was being deferred. Arguing they would be hit hard with capital-gains taxes if they received the money, Rinehart moved the vesting date to 2068.

Rinehart fought to have details of the case suppressed, and failed. When, in March, a Perth journalist reported that the children's AUD$100,000 monthly legal bills were being subsidised by Chinese businessmen, Rinehart's legal team responded with wide-ranging subpoenas aimed at uncovering the donors' identities.

Chris Warren, federal secretary of journalists' union Media Alliance, said Rinehart's behaviour was galling for an aspiring media baron, and the case represented a major threat to press freedom. "If people are going to buy into the media, they need a fundamental understanding of how the media works, which includes journalists protecting their sources," he said.

Rinehart rarely grants interviews, and declined to answer questions for this article. But few see her media adventures as merely investments. "Gina recognises that money is power, and the purchasing of opinion is wide open in modern democracies," says Brown. Hancock himself had started newspapers to push his beliefs, and gone "on record saying one of the best ways of getting better media coverage is to buy it".

Born in Perth in 1954, the only child of Hancock and his second wife, Hope Margaret Nicholas, Georgina Hope Hancock grew up in awe of her tough, enterprising father, telling a BBC documentary crew at age 12 she considered him "nearly perfect".

From her early teens, she was groomed as her father's successor. Hancock referred to her as his "right-hand man"; Rinehart parroted his political views. According to one profile, she didn't like her mother to travel in the family Rolls-Royce, insisting it was reserved for her and Hancock.

In her late teens, Rinehart married an Englishman, Greg Milton, whom she met in a Perth paint shop. Hancock thought she could do better. They had two children, John and Bianca, but separated when the children were pre-schoolers.

Two years later, aged 28, she married a 57-year-old American tax lawyer named Frank Rinehart. Hancock refused to attend their wedding. Frank Rinehart adopted her two children, and the couple had two daughters of their own, Hope and Ginia, dividing their time between their respective countries before his death in 1990.

But it was another unlikely relationship that would cause the real rift between father and daughter. Several months after her marriage, following the death of her mother, Rinehart hired a flamboyant 34-year-old Filipina, Rose Lacson, to care for her 73-year-old father. Not to be outdone by his daughter, Hancock promptly started a relationship with the help, marrying her within two years.

Rinehart was appalled, and her relationship with Hancock deteriorated. When she wrote to him complaining he had become the subject of "dirty old man" jokes, he responded: "If you won't consider my well-being, at least allow me to remember you as [a] neat, trim, capable and attractive young lady... rather than the slothful, vindictive and devious baby elephant that you have become".

Then there were Hancock's maverick schemes, such as bringing out US-Hungarian physicist Edward Teller – "father of the hydrogen bomb" – to investigate the possibilities of using nuclear explosives in mining, including creating a deep-water harbour. He also did deals with Romanian dictator Nicolae Ceausescu, and spoke on television of sterilising "no-good half-caste" Aborigines. Even less forgivably, by his own standards, he was slipping up in business, making a mess of a number of deals.

This gradual tarnishing of her father's once heroic image deeply affected Rinehart, says Ferguson, and has spurred her to redeem the Hancock name. "Him losing his reputation also reflects badly on her, and is part of what this is all about," she says. "It all stems back to her father."

Rinehart briefly reconciled with Hancock before his death, but resumed hostilities with his widow when the latter remarried with one of Hancock's friends less than three months later. She then pursued a nearly decade-long campaign to prove his widow had hastened her father's death.

The soap opera of Hancock's inquest revealed allegations his widow – now Rose Porteous – had hired her former husband to kill Hancock. But it emerged the supposed hit-man had been paid AUD$250,000 by Rinehart, "for his own protection", to take the stand. The inquest found no evidence Porteous was involved in Hancock's death, but the attorney-general declared Rinehart's payment "highly suspicious".

Lawyer Nicholas Styant-Browne, who acted for Porteous, describes the inquest as a "disaster" for Rinehart, saying she used her wealth to pursue a vendetta to her detriment. "Gina is an extremely litigious individual, and utterly indefatigable."

That dogged, unforgiving character has imprinted itself time and again on her inseparable business and private lives. Rinehart sees issues in black and white, say observers – for or against her interests – then musters the full weight of her resources behind her determinations. "She wants control – that's her modus operandi," says Treadgold, referring to her as a "human bulldozer" who brooks no dissent from her subordinates. "She treats people with absolute ruthlessness if they cross her," says Ferguson.

That list not only includes Porteous, any number of journalists, and a string of former employees at Hancock Prospecting, known in mining circles for its high staff turnover, but also three of her children, the two eldest of whom were once groomed to succeed her. (As Rinehart works through her stocks of potential successors, that mantle has fallen on the youngest, Ginia.)

So little is known about Rinehart's personal life that it's unclear whether she has someone to spend her downtime with on The World, the palatial residential cruise ship that serves as her home away from home. A rare glimpse came in 1997, when she settled with a former live-in security guard who had accused her of sexual harassment. He told a magazine he felt his former boss was "just incredibly lonely and isolated".

Whether or not she has found happiness since, her unrelenting pursuit of her vision for the Hancocks' and Australia's linked destiny has come at considerable personal expense.

"At the forefront of it all is the conviction that she's right," says Ferguson. "It all comes from the sense she has to prove herself right." But what more does the world's richest woman have to prove? "She doesn't actually realise she's won," says Treadgold. "The full-time siren's gone, the other team's walking off to the changing sheds, and she's still out there playing."

* Additional reporting by Finbarr Bunting.