A UK subsidiary of mining giant Glencore has been ordered to pay more than £280 million by a London judge for bribing officials across Africa to gain access to oil.

It follows an investigation opened by the Serious Fraud Office (SFO) in 2019, focused on the activity of Glencore Energy UK’s West Africa desk, which sourced and traded in crude oil from countries across Africa.

Glencore pleaded guilty in June this year to seven counts of bribery, after the probe exposed it had paid bribes to maximise its oil trading profits in five African countries.

Mr Justice Fraser said “the facts demonstrate not only significant criminality but sophisticated devices to disguise it” and the corruption was of “extended duration” and “was endemic amongst traders on that particular desk”.

SFO’s investigation uncovered a trail of text messages, large cash withdrawals and deliberately concealed payments that showed Glencore paid bribes worth $29 million (£25.9m) in total to gain access to oil in Cameroon, Equatorial Guinea, Ivory Coast, Nigeria and South Sudan.

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 “service fee”, “signing bonus” or “success fee” in financial reports.

Private jets stashed with cash

In Cameroon and South Sudan, two Glencore executives from the West Africa desk flew to South Sudan by private jet in August 2011, carrying $800,000 (£713,919) in cash, which had been withdrawn from the cash desk at the company’s Swiss headquarters and recorded as expenses for “opening [the] office in South Sudan”.

The money was paid via a local agent to officials in the newly-established government in South Sudan, followed by a further $275,000 (£245,410) in cash.

Between 2012 and 2015, another Glencore trader withdrew $8.2 million (£7.3m) in cash from the firm’s Swiss cash desk and recorded it as “office expenses” despite there being limited evidence of any office operating in the country.

This, along with $5.5 million (£4.9m) of “service fees” withdrawn in cash by a Nigerian agent, was periodically flown on private jets to Cameroon and was used to bribe officials in the country’s national oil and gas companies.

The financial penalty includes a fine, a confiscation order for the profit Glencore obtained from bribes and the SFO’s costs in full.

‘Inexcusable’ conduct

Kalidas Madhavpeddi, Chairman of Glencore said: “The conduct that took place was inexcusable and has no place in Glencore. The Company is committed to operating a company that creates value for all stakeholders by operating transparently under a well-defined set of values, with openness and integrity at the forefront.

“The Company has taken significant action towards implementing a world-class Ethics and Compliance Programme built around risk assessment, policies, procedures, standards and guidelines based on international best practice, associated training and awareness initiatives as well as monitoring systems.”

Article source: https://www.energylivenews.com/2022/11/04/glencore-ordered-to-pay-280m-over-african-oil-bribes/