Energy trader Gunvor to pay $662 million to end US, Swiss bribery cases By Reuters
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By Jonathan Stempel, Luc Cohen, Chris Prentice and Julia Payne
NEW YORK (Reuters) -Gunvor, one of the world’s largest oil traders, agreed on Friday to pay about $662 million to resolve U.S. and Swiss investigations into a scheme to pay bribes to Ecuadorean officials to win business.
Gunvor pleaded guilty to conspiring to violate a U.S. bribery law at a hearing in federal court in Brooklyn, New York, marking the end of a long-running criminal probe.
The Geneva-based firm also resolved a related investigation by the Office of the Attorney General of Switzerland.
Jean-Baptiste Leclercq, Gunvor’s general counsel, told U.S. District Judge Eric Vitaliano that the trader joined a conspiracy that ran afoul of the Foreign Corrupt Practices Act (FCPA) by paying intermediaries to win business with Ecuador’s national oil company Petroecuador.
The payout includes a $374.6 million criminal fine and a forfeiture of $287.1 million. Gunvor will be credited for up to $93 million in payments to both Switzerland and Ecuador.
In a statement, Chairman Torbjörn Törnqvist said Gunvor was sorry for past mistakes and committed to enhancing its now “industry-leading compliance program.” The deal does not require Gunvor to hire a monitor.
The U.S. Department of Justice and the U.S. Commodity Futures Trading Commission had been probing Gunvor since at least 2020, and a former employee in 2021 pleaded guilty over a scheme to bribe Ecuadorean government officials to win business.
Reuters reported in December that Gunvor had set aside $650 million to resolve the probe.
Authorities said that between 2012 and 2020, Gunvor and other conspirators paid more than $97 million to intermediaries, knowing some of the cash would be used to bribe officials in Ecuador.
In exchange, high-level Ecuadorean officials helped front companies for Gunvor win rights to a series of oil-back loan contracts with Petroecuador, authorities said.
One Gunvor employee directed an intermediary to bestow an 18-karat gold Patek Philippe watch on a Petroecuador official, the Justice Department said.
Switzerland’s Attorney General also found Gunvor criminally liable for corruption in 2019, when it was ordered to pay $95 million for bribing officials in Congo Republic and the Ivory Coast.
That case was the first where a major trading firm had been found guilty on such charges in Switzerland.
U.S. prosecutors have made a multi-year push to root out fraud and misconduct in the commodities sector.
Traders who buy and sell raw materials often operate in jurisdictions where corruption is common, putting them at risk of violating the FCPA, which prohibits paying bribes to foreign officials.
Glencore (OTC:) agreed to pay more than $1 billion in connection with a decade-long bribery scheme covering several countries.
And in December, Connecticut-based commodities trader Freepoint Commodities reached a $98 million settlement of bribery and other U.S. charges.
Vitol, the world’s largest oil trader, resolved U.S. and Brazilian probes in December 2020 by agreeing to pay $164 million and admitting to bribing officials in Brazil, Mexico and Ecuador. One of its employees, Javier Aguilar, was convicted last month of bribing Ecuadorean officials.
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By Jonathan Stempel, Luc Cohen, Chris Prentice and Julia Payne
NEW YORK (Reuters) -Gunvor, one of the world’s largest oil traders, agreed on Friday to pay about $662 million to resolve U.S. and Swiss investigations into a scheme to pay bribes to Ecuadorean officials to win business.
Gunvor pleaded guilty to conspiring to violate a U.S. bribery law at a hearing in federal court in Brooklyn, New York, marking the end of a long-running criminal probe.
The Geneva-based firm also resolved a related investigation by the Office of the Attorney General of Switzerland.
Jean-Baptiste Leclercq, Gunvor’s general counsel, told U.S. District Judge Eric Vitaliano that the trader joined a conspiracy that ran afoul of the Foreign Corrupt Practices Act (FCPA) by paying intermediaries to win business with Ecuador’s national oil company Petroecuador.
The payout includes a $374.6 million criminal fine and a forfeiture of $287.1 million. Gunvor will be credited for up to $93 million in payments to both Switzerland and Ecuador.
In a statement, Chairman Torbjörn Törnqvist said Gunvor was sorry for past mistakes and committed to enhancing its now “industry-leading compliance program.” The deal does not require Gunvor to hire a monitor.
The U.S. Department of Justice and the U.S. Commodity Futures Trading Commission had been probing Gunvor since at least 2020, and a former employee in 2021 pleaded guilty over a scheme to bribe Ecuadorean government officials to win business.
Reuters reported in December that Gunvor had set aside $650 million to resolve the probe.
Authorities said that between 2012 and 2020, Gunvor and other conspirators paid more than $97 million to intermediaries, knowing some of the cash would be used to bribe officials in Ecuador.
In exchange, high-level Ecuadorean officials helped front companies for Gunvor win rights to a series of oil-back loan contracts with Petroecuador, authorities said.
One Gunvor employee directed an intermediary to bestow an 18-karat gold Patek Philippe watch on a Petroecuador official, the Justice Department said.
Switzerland’s Attorney General also found Gunvor criminally liable for corruption in 2019, when it was ordered to pay $95 million for bribing officials in Congo Republic and the Ivory Coast.
That case was the first where a major trading firm had been found guilty on such charges in Switzerland.
U.S. prosecutors have made a multi-year push to root out fraud and misconduct in the commodities sector.
Traders who buy and sell raw materials often operate in jurisdictions where corruption is common, putting them at risk of violating the FCPA, which prohibits paying bribes to foreign officials.
Glencore (OTC:) agreed to pay more than $1 billion in connection with a decade-long bribery scheme covering several countries.
And in December, Connecticut-based commodities trader Freepoint Commodities reached a $98 million settlement of bribery and other U.S. charges.
Vitol, the world’s largest oil trader, resolved U.S. and Brazilian probes in December 2020 by agreeing to pay $164 million and admitting to bribing officials in Brazil, Mexico and Ecuador. One of its employees, Javier Aguilar, was convicted last month of bribing Ecuadorean officials.
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