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Trafigura to Pay $127 Million to Settle U.S. Bribery Charges on Petrobras Deals

Swiss company pleads guilty to charges it paid bribes to Petrobras officials
Swiss company pleads guilty to charges it paid bribes to Petrobras officials. Between 2003 and 2014, Trafigura and its co-conspirators bribed Petróleo Brasileiro officials to obtain and retain business with the oil company, according to the Justice Department. Photo: Denis Balibouse/Reuters

David Smagalla, WSJ

NEW YORK
EnergiesNet.com 03 29 2024

Swiss commodity trading company Trafigura has settled U.S. charges that it bribed Brazilian officials to secure business with the country’s state-owned oil company.

Trafigura pleaded guilty in Miami federal court to one count of conspiring to violate the antibribery provisions of the Foreign Corrupt Practices Act and agreed to pay nearly $127 million. 

The company said the settlement didn’t include the appointment of an independent monitor.

Between 2003 and 2014, Trafigura and its co-conspirators bribed Petróleo Brasileiro officials to obtain and retain business with the oil company, according to the Justice Department.

Meetings took place in Miami, in which they agreed to pay up to 20 cents per barrel of oil bought from or sold to

Petrobras

by Trafigura, according to the Justice Department. Trafigura hid the payments through the use of shell companies and by funneling payments through third parties who used offshore bank accounts to provide the bribes to Brazilian officials, the Justice Department said. 

Trafigura ultimately made $61 million in profits from the bribery scheme, according to the Justice Department. 

The Justice Department said Trafigura received some credit for cooperating with its investigation, but said that during the early phases of the probe the company failed to preserve and produce documents and evidence in a timely manner. It later enabled interviews with employees and agents, including ones outside the U.S. 

The agency also said Trafigura has since engaged in a number of remedial measures, such as enhancing its compliance monitoring and controls testing process, and putting in place new policies around corruption, the use of intermediaries, consultants and third-party payments.

Trafigura Chief Executive Jeremy Weir said the company was “pleased the DOJ recognized the steps we have taken to invest in our compliance function.” The company also said it decided in 2019 to end the use of third-party agents for sourcing business.

The Justice Department said its probes into commodity trading companies paying bribes to win business with state-owned and state-controlled oil companies in Latin America and Africa have resulted in six corporate resolutions and monetary penalties of more than $1.7 billion.

Recent settlements include an agreement by Freepoint Commodities in December to pay more than $98 million to settle Justice Department and Commodity Futures Trading Commission allegations that it conspired to bribe Brazilian officials to secure business from Petrobras.

More recently, a unit of energy commodity trading firm Gunvor Group agreed this month to pay about $661 million after it admitted to bribing officials at Ecuador’s ministry of hydrocarbons and at state-oil company Petroecuador to win contracts to buy oil products.

  1. Risk & Compliance Journal

Trafigura to Pay $127 Million to Settle U.S. Bribery Charges

Swiss company pleads guilty to charges it paid bribes to Petrobras officials

By David Smagalla

Updated March 28, 2024 5:40 pm ET



Between 2003 and 2014, Trafigura and its co-conspirators bribed Petróleo Brasileiro officials to obtain and retain business with the oil company, according to the Justice Department. Photo: denis balibouse/Reuters

Swiss commodity trading company Trafigura has settled U.S. charges that it bribed Brazilian officials to secure business with the country’s state-owned oil company.

Trafigura pleaded guilty in Miami federal court to one count of conspiring to violate the antibribery provisions of the Foreign Corrupt Practices Act and agreed to pay nearly $127 million. 

The company said the settlement didn’t include the appointment of an independent monitor.

Between 2003 and 2014, Trafigura and its co-conspirators bribed Petróleo Brasileiro officials to obtain and retain business with the oil company, according to the Justice Department.

Meetings took place in Miami, in which they agreed to pay up to 20 cents per barrel of oil bought from or sold to

Petrobras

by Trafigura, according to the Justice Department. Trafigura hid the payments through the use of shell companies and by funneling payments through third parties who used offshore bank accounts to provide the bribes to Brazilian officials, the Justice Department said. 

Trafigura ultimately made $61 million in profits from the bribery scheme, according to the Justice Department.

The Justice Department said Trafigura received some credit for cooperating with its investigation, but said that during the early phases of the probe the company failed to preserve and produce documents and evidence in a timely manner. It later enabled interviews with employees and agents, including ones outside the U.S. 

The agency also said Trafigura has since engaged in a number of remedial measures, such as enhancing its compliance monitoring and controls testing process, and putting in place new policies around corruption, the use of intermediaries, consultants and third-party payments.

Trafigura Chief Executive Jeremy Weir said the company was “pleased the DOJ recognized the steps we have taken to invest in our compliance function.” The company also said it decided in 2019 to end the use of third-party agents for sourcing business.

The Justice Department said its probes into commodity trading companies paying bribes to win business with state-owned and state-controlled oil companies in Latin America and Africa have resulted in six corporate resolutions and monetary penalties of more than $1.7 billion.

Recent settlements include an agreement by Freepoint Commodities in December to pay more than $98 million to settle Justice Department and Commodity Futures Trading Commission allegations that it conspired to bribe Brazilian officials to secure business from Petrobras.

More recently, a unit of energy commodity trading firm Gunvor Group agreed this month to pay about $661 million after it admitted to bribing officials at Ecuador’s ministry of hydrocarbons and at state-oil company Petroecuador to win contracts to buy oil products.

Write to David Smagalla at David.smagalla@wsj.com

wsj.com 03 28 2024

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