Glencore Energy UK Ltd will pay \u00a3280,965,092.95 million (over 400 million USD) after an SFO investigation revealed it paid US $29 million in bribes to gain preferential access to oil in Africa.<\/p>\n
At Southwark Crown Court today, Mr Justice Fraser, reflected in his judgement that\u00a0\u201cthe facts demonstrate not only significant criminality but sophisticated devices to disguise it<\/em>\u201d before sentencing the commodities trading giant to pay a financial penalty in response to the seven charges of bribery that \u201crepresent sophisticated offending that was sustained over prolonged periods of time<\/em>\u201d.<\/p>\n Mr Justice Fraser remarked on the culture that developed at Glencore\u00a0\u201cin which bribery was accepted as part of the West Africa desk\u2019s way of doing business<\/em>\u2026\u00a0The corruption is of extended duration\u2026 It was endemic amongst traders on that particular desk<\/em>\u2026\u00a0Bribery is a highly corrosive offence. It quite literally corrupts people and companies, and spreads like a disease.<\/em>\u201d<\/p>\n Commenting on the financial penalty \u2013 the largest ever for an SFO case following a conviction, Mr Justice Fraser noted: \u201cThis is a significant overall total. Other companies tempted to engage in similar corruption should be aware that similar sanctions lie ahead<\/em>.\u201d<\/p>\n Glencore pleaded guilty in June this year to seven counts of bribery, after an SFO investigation exposed that it had paid bribes to maximise its oil trading profits in five African countries.<\/p>\n The conviction includes the first ever use of substantive bribery offences for a company, meaning senior individuals at Glencore authorised the bribery instead of simply failing to prevent it.<\/p>\n The financial penalty ordered by the Judge includes a fine (US$289,117,138), a confiscation order for the profit it obtained from bribes ( \u00a393,479,338.95 million), and the SFO\u2019s costs in full (\u00a34,550,362 million). The confiscation order is not only the largest ever for an SFO case, the total amount the company will pay (\u00a3280 million) is the highest ever ordered in a corporate criminal conviction.<\/p>\n SFO investigation<\/strong><\/p>\n The SFO opened an investigation into Glencore in 2019, focussed on the activity of the London-based West Africa desk. This desk sourced and traded in crude oil from countries across Africa.<\/p>\n The investigation uncovered a trail of text messages, large cash withdrawals and deliberately concealed payments that showed Glencore paid bribes worth a total of $29m to secure its access to oil in Cameroon, Equatorial Guinea, Ivory Coast, Nigeria and South Sudan.<\/p>\n In Nigeria, Equatorial Guinea and the Ivory Coast, Glencore was revealed to have used well-connected local agents to funnel bribes into state-owned oil companies and government ministries, often disguising a bribe as an unspecified \u201cservice fee\u201d, \u201csigning bonus\u201d or \u201csuccess fee\u201d in financial reports.<\/p>\n $15 million of \u201coffice expenses\u201d used as cash bribes<\/strong><\/p>\n In Cameroon and South Sudan, the approach used was different. In August 2011, two Glencore executives from the West Africa desk flew to South Sudan by private jet, carrying $800,000 in cash. The money had been withdrawn from the cash desk at Glencore Plc\u2019s Swiss headquarters and recorded as expenses for \u201copening [the] office in South Sudan\u201d. The money was paid via a local agent to officials in the newly established government in South Sudan, and this was followed by a further $275,000 in cash.<\/p>\n Between 2012 and 2015, another Glencore trader withdrew a total of $8.2m in cash from the company\u2019s Swiss cash desk, recorded as \u201coffice expenses\u201d, despite there being limited evidence of any office operating in the country. This, along with $5.5m of \u201cservice fees\u201d withdrawn in cash by a Nigerian agent, was periodically flown, again on private jets, to Cameroon. It was used to bribe officials in the country\u2019s national oil and gas companies.<\/p>\n Lisa Osofsky, Director, Serious Fraud Office said<\/strong>: \u201cThe SFO has today brought justice to bear and exposed what was a deliberate and endemic culture of bribery at Glencore.<\/p>\n \u201cThis has been a landmark case in UK anti-bribery enforcement, marking the first time since the introduction of the Bribery Act 2010 that a corporate has been convicted for the active authorisation of bribery, rather than purely a failure to prevent it.<\/p>\n \u201cFor years and across the globe, Glencore pursued profits to the detriment of national governments in some of the poorest countries in the world. The company\u2019s ruthless greed and criminality have been rightfully exposed.\u201d<\/p>\n This is the first sentence to be handed down to Glencore for bribery offences. The SFO has worked in parallel with the US Department of Justice, and closely with the Dutch and the Swiss on this investigation. Glencore has also been charged with both market manipulation and bribery offences in the US. On the former, they were sentenced in September to US $486 million.<\/p>\n","protected":false},"excerpt":{"rendered":"