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Switzerland Charges Trafigura and a Former Top Executive With Bribery – WSJ

Former chief operating officer Mike Wainwright is accused of helping to funnel millions of dollars to an Angolan official, including cash payments
Former chief operating officer Mike Wainwright is accused of helping to funnel millions of dollars to an Angolan official, including cash payments. Trafigura made about $144 million in profits from shipping contracts it gained in return for the payments, prosecutors said. (Denis Balibouse/Reuters)

Joe Wallace, WSJ

LONDON
EnergiesNet.com 12 07 2023

Swiss prosecutors charged a former top executive at Trafigura with facilitating payment of millions of dollars’ worth of bribes to land the energy trader preferential treatment in African oil producer Angola.

Mike Wainwright helped to funnel part of the payments to an Angolan official, Swiss prosecutors said in an indictment at the Federal Criminal Court on Wednesday. These included more than 4.3 million euros, equivalent to $4.6 million, to a bank account in Geneva between 2009 and 2011, and $604,000 in cash payments in Angola. 

The allegations paint a murky picture of the underbelly of commodity markets, where the oil, metals and grains that power, build and feed the world change hands and move between continents. 

The industry is dominated by a small group of mostly private companies, of which Trafigura is one of the biggest. The companies compete fiercely to do business in resource-rich countries susceptible to corruption. Authorities in the U.S., Switzerland and elsewhere have alleged in a series of indictments in recent years that different firms resorted to corruption to get one up over their rivals.

Prosecutors also charged the former Angolan official alleged to have received the payments—a middleman for Trafigura—and the company itself for lax controls that prosecutors said made bribery possible. Trafigura earned about $144 million in profits from shipping contracts it gained in return for the payments, the prosecutors said.

Trafigura said it had hoped to settle the case but would defend itself in court.

The executive “disputes ever having instructed or authorized payment with a corrupt intent,” an attorney for Wainwright said.

The case is a second black eye for Trafigura this year. In February, the company said it had lost almost $600 million due to what it said was a fraud in the nickel market.

Wainwright, a British trader, was one of Trafigura’s top three executives and one of its biggest shareholders when he unexpectedly said in April that he would stand down as chief operating officer and soon retire.

He joined Trafigura in 1996, shortly after it was founded by a group of breakaway Marc Rich & Co.traders in 1996. At the time, Trafigura was a scrappy upstart run by its mercurial founder, Claude Dauphin, who cultivated high-level contacts in countries including Angola.

Jeremy Weir, chief executive of Trafigura, said it had striven to ‘instill a culture of responsible conduct.’ Photo: F. Carter Smith/Bloomberg News
Jeremy Weir, chief executive of Trafigura, said it had striven to ‘instill a culture of responsible conduct.’ (F. Carter Smith/Bloomberg)

When Dauphin died in 2015, Angola’s vice president attended his funeral. Wainwright was one of three executives who stepped up to steer the company, along with Jeremy Weir, who became chief executive, and Jose Maria Larocca, now executive director.

Trafigura said Wednesday it expects to resolve a U.S. Justice Department investigation into improper payments in Brazil. The company said it would set aside $127 million to do so in its yet-to-be published 2023 annual report. Trafigura said it was involved in a continuing civil case in Brazil.

“We sincerely regret these incidents which breached our code of conduct and are contrary to our values,” said Weir. “We have made extensive efforts over many years to instill a culture of responsible conduct at Trafigura.”

Write to Joe Wallace at joe.wallace@wsj.com

Appeared in the December 7, 2023, print edition as ‘Ex-Energy Executive Is Indicted’.

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