Switzerland-based mining and commodities giant Glencore plc on Tuesday settled corruption investigations in the United States, the UK, and Brazil. In the U.S., subsidiary Glencore International AG pleaded guilty to one count of conspiracy to violate the FCPA and agreed to pay $700 million in criminal penalties and forfeiture.
The plea agreement with the DOJ imposed $429 million in criminal penalties and forfeiture of $272 million. The plea agreement requires Glencore to retain a compliance monitor for three years.
As part of the U.S. resolution, a subsidiary of Glencore also agreed to plead guilty and pay $485.6 million to resolve market manipulation investigations by the DOJ and the Commodity Futures Trading Commission. After crediting about $166 million of that payment to amounts to be paid in the UK and possibly other countries, penalties assessed in the United States will be just over $1 billion.
At a DOJ press conference Tuesday, Damian Williams, U.S. Attorney for the Southern District of New York, said, “Bribery was built into the corporate culture” of Glencore.
The company paid $100 million in bribes overall, according to the FBI’s Brian Turner. Corrupt payments went to officials in Nigeria, Cameroon, Ivory Coast, Equatorial Guinea, Brazil, Venezuela, and the Democratic Republic of the Congo (DRC), the DOJ said.
In the UK, a local subsidiary agreed to plead guilty. During a hearing at London’s Westminster Magistrates’ Court, the Serious Fraud Office charged Glencore Energy (UK) Ltd with seven counts of bribery. Sentencing is set for June 21, 2022, when penalties will be imposed.
In Brazil, Glencore agreed to pay $39.6 million under a resolution with the Brazilian Federal Prosecutor’s Office.
Glencore said it expects to pay total penalties of $1.5 billion to resolve today’s U.S. and Brazil settlements and its final settlement in the UK.
Investigations by the Office of the Attorney General of Switzerland and the Dutch Public Prosecution Service are ongoing, the company said.
Last year, former Glencore trader Anthony Stimler pleaded guilty to violating the FCPA and conspiracy to commit money laundering. The DOJ alleged that from 2007 to 2018, Stimler and co-conspirators bribed Nigerian officials to obtain and retain business for Glencore. They used “inflated and fraudulent invoices to disguise the nature and purpose of bribe payments made to government officials,” the DOJ said in Stimler’s criminal information.
Glencore first disclosed the investigation into FCPA-related offenses in early July 2018, according to data from FCPA Tracker. The company said then a subsidiary received a subpoena from the DOJ “to produce documents and other records with respect to compliance with the Foreign Corrupt Practices Act and United States money laundering statutes.”
The DOJ said Tuesday Glencore’s conduct “involved high-level employees and agents of the company.”
According to the DOJ, Glencore did not receive full cooperation and remediation credit because it “did not consistently demonstrate a commitment to full cooperation, it delayed producing relevant evidence, and it did not timely and appropriately remediate with respect to disciplining certain employees involved in the misconduct.”
On Tuesday, Glencore CEO Gary Nagle said, “We acknowledge the misconduct identified in these investigations and have cooperated with the authorities.” He said the company has taken “significant action towards building and implementing a world-class ethics and compliance program.”
Glencore operates about 150 mining, metallurgical, and oil production facilities worldwide. It has around 135,000 employees and contractors and about $200 billion in annual revenues.