Glencore to Pay $1 Billion Settlement Amid Allegations of US Bribery and Market Abuse | glencore

Commodity trading giant Glencore will pay a $1bn (£800m) US settlement and has indicated it will plead guilty to seven UK bribery charges related to its oil operations in Africa.

Glencore, a member of the FTSE 100 index of Britain’s largest public companies, said it would pay fines of $700 million to settle US bribery investigations and $485 million to settle market manipulation investigations. , with some reductions in anticipation of agreements in other countries.

The company also indicated that a UK subsidiary would plead guilty to the charges heard at Westminster magistrates’ court in London on Tuesday, the UK Serious Fraud Office said in a statement.

The charges followed investigations by US and UK authorities, which began in 2018 and 2019, respectively. When Glencore first disclosed the US Justice Department investigation in 2018, it said business-related documents dating back to 2007 were requested.

The SFO alleged that it had found “for-profit bribery and corruption in the company’s oil operations in Cameroon, Equatorial Guinea, Ivory Coast, Nigeria and South Sudan.”

“Glencore agents and employees paid more than $25 million worth of bribes for preferential access to oil, with the company’s approval,” the SFO alleged.

In February, the company said it had set aside $1.5 billion to cover potential fines and costs related to bribery and corruption investigations in the UK, US and Brazil. Although the deal is significant, it is still smaller than the $4 billion Glencore announced, on the same day, that would be returned to shareholders after record profits.

A sentencing hearing will take place on June 21, when the payments it must make will be determined, although Glencore said it did not expect the total fines to exceed the $1.5 billion set aside, suggesting that it is likely that UK authorities receive significantly less than US counterparts

Dutch and Swiss authorities are also investigating alleged irregularities, some of which are believed to be related to operations in the Democratic Republic of the Congo.

Lisa Osofsky, Director of the Serious Fraud Office, said, “This important investigation, which the Serious Fraud Office has brought to justice in less than three years, is the result of our experience, our tenacity and the strength of our partnership. with the US other jurisdictions.

“We will not stop fighting serious fraud, bribery and corruption, and we look forward to the next steps in this important prosecution.”

Kalidas Madhavpeddi, Chairman of Glencore, said: “Glencore today is not the company it was when the unacceptable practices behind this misconduct occurred.”

Susan Hawley, executive director of Spotlight on Corruption, a campaign group, welcomed the SFO’s charges after “long-standing allegations of serious corruption,” but added that it was “critical” that any settlement included “compensation for victims of corruption.” his alleged corruption in West Africa”.

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“As the first potential corporate conviction under section 1(1) and (2) of the Bribery Act, it is particularly significant that Glencore could face a serious risk of being excluded from public contracts,” Hawley said.

“It is essential that those responsible for wrongdoing, including senior executives and the parent company, be held accountable and that there is full transparency about any steps Glencore takes to improve its anti-corruption and compliance measures.”

Glencore confirmed in a stock announcement Tuesday afternoon that it would appear in UK and US courts “in relation to the proposed resolutions of the relevant investigations”, and would make a further statement after the hearings were over.

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