Glencore fined $314 million for 'endemic' bribery of African oil officials
By Anna Cooban, CNN BusinessUpdated: Thu, 03 Nov 2022 16:36:40 GMTSource: CNN BusinessCommodities giant Glencore has been ordered to pay a record £281 million ($314 million) penalty by a UK court forBy Anna Cooban, CNN Business
Updated: Thu, 03 Nov 2022 16:36:40 GMT
Source: CNN Business
Commodities giant Glencore has been ordered to pay a record £281 million ($314 million) penalty by a UK court for bribing officials across Africa to gain access to oil.
The UK government's Serious Fraud Office (SFO), which brought the case against Glencore Energy UK, said on Thursday that the penalty was the biggest ever handed out for a corporate criminal conviction in the country.
In June, the commodities trader admitted to seven counts of bribery at a court in London. The penalty announced on Thursday includes a fine, legal costs and confiscation of the profit Glencore made from its bribes.
"The conduct that took place was inexcusable and has no place in Glencore," company Chairman Kalidas Madhavpeddi said in a statement on Thursday, adding that the firm had taken "significant action" to build a new ethics and compliance program.
The SFO investigation found that Glencore had funneled about $29 million worth of bribes between 2011 and 2016 through its workers and agents across its oil operations in Nigeria, Cameroon, the Ivory Coast, Equatorial Guinea and South Sudan.
The money was used to secure preferential access to bigger cargoes and more valuable grades of oil as well as preferred delivery dates, the SFO said earlier his year.
Private jets stashed with cash
Judge Peter Fraser said Thursday that "bribery was accepted as part of [Glencore's] West Africa desk's way of doing business" and was "endemic amongst [its] traders."
Bribes paid to state-owned oil companies and government ministries across Nigeria, Equatorial Guinea and the Ivory Coast were often concealed as an unspecified "service fee", "signing bonus" or "success fee," the SFO said, citing Glencore's financial reports.
It also found that, between 2012 and 2015, a Glencore trader and Nigerian agent withdrew a total $13.7 million in cash from Glencore's Swiss cash desk. The cash was flown on a private jet to Cameroon, where it was used to bribe officials in the country's national oil and gas companies.
In August 2011, two Glencore executives flew $800,000 in cash on a private jet from Switzerland to South Sudan. The money was recorded as an expense needed to open an office in the country, the SFO said. The money was paid via a local agent to officials in the newly established government in South Sudan.
Glencore said in May that it had resolved investigations into separate bribery charges brought by authorities in the United States and Brazil.
The company has set aside $1.5 billion to settle its legal cases, including the UK bribery action, it said Thursday.