July 13, 2024

UK Court orders Glencore to pay $310.6million fine over crude oil bribery charges in Nigeria

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A United Kingdom Court has ordered Glencore Energy UK Limited, British subsidiary of mining and trading group Glencore (GLEN.L) to pay a total penalty of 276.4 million pounds ($310.6 million) on Thursday for seven bribery offenses, including $52 million bribes paid to some Nigerian officials between 2007 and 2018 and four other African countries in relation to its oil operations.

Judge Peter Fraser at Southwark Crown Court, in his judgment delivered on Thursday, ordered the Swiss-based commodity trading multinational, to pay a total sum of £182.9 million fine. The Court also approved a £93.5 million confiscation order on Glencore.

Glencore is the world’s biggest commodities trader, shifting millions of tonnes of metals, minerals, and oil across the globe.

The judge in the ruling said that the offences represented “corporate corruption on a widespread scale, deploying very substantial sums of money in bribes”.

Glencore had pleaded guilty in June to seven counts of bribery, following a probe by Britain’s Serious Fraud Office (SFO).

The Judge said, “The corruption is of extended duration, and took place across five separate countries in West Africa, but had its origins in the West Africa oil trading desk of the defendant in London. It was endemic amongst traders on that particular desk.”

SFO had earlier on Wednesday informed the Judge that Glencore Energy UK Limited paid or failed to prevent the payment of millions of dollars in bribes to officials in the five African countries.

The UK Fraud Office told the Court that the fund was transported, often by private jet, from Nigeria to Cameroon to a Glencore oil trader who used it to pay bribes.

According to the SFO, $13.7m was paid to officials in Cameroon’s national oil and gas company and the country’s national refinery in the three years to March 1, 2015.

The Prosecutors also said that the London-listed miner and commodity trader reportedly used a Swiss cash desk to dispense money for the settlement of multiple agreements in order to purchase crude oil and refined petroleum products on more favorable delivery terms from the NNPC through two Glencore’s wholly-owned subsidiaries and their business partners.

The trader had through Anthony Stimler, its former Staff, withdrawn €6.3 million in cash from the African desk through a series of transactions listed as “office expenses”.

The Prosecutors alleged that Stimler and other agents of the firm used private jets to transfer cash to pay the bribes.

The Glencore former staff was also alleged to have conspired to transmit the bribe payments from Switzerland through the United States, and to other countries, including Nigeria.

Prosecutors alleged that the manner and means by which Mr. Stimler and his co-conspirators sought to accomplish the purpose of the conspiracy included, among others, using and paying inflated and fraudulent invoices submitted to the company and its subsidiaries by intermediaries to disguise the nature and purpose of bribe payments made to government officials.

It was alleged that Glencore made the payments in order to obtain and retain business advantages for itself and other subsidiaries.

Glencore, had in February announced record earnings on the back of soaring prices for its cornerstone commodities. It then noted that it would pay up to $1.5 billion to settle the allegations of bribery and market manipulation in the United States, Brazil, and Britain.

The Court papers did not name the co-conspirators, and none of them was charged, it referred to seven such individuals and companies from several countries in the bribery scheme.

But Mr. Stimler however mentioned Diezani Alison-Madueke, Nigeria’s former Petroleum Minister, as the top Government official, and others were involved in the bribery scheme.

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