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May 25, 2022

Glencore to pay up to $1.5bn to settle corruption allegations

The miner is also currently under probe in Switzerland and the Netherlands.

Swiss mining and commodities trader Glencore has agreed to pay up to $1.5bn in penalties to settle probes into bribery and market manipulation allegations in the US, Brazil and the UK.

In the US, the firm was accused of violating the Foreign Corrupt Practices Act (FCPA), as well as committing a multi-year scheme for manipulating commodity prices at two commercial shipping ports.

The charges have been filed against Glencore and its subsidiaries for making and hiding corrupt payments and bribes via intermediaries.

According to the US resolutions’ terms, the commodities trader will pay $700.7m in penalties to settle bribery investigations, as well as $485.6m to resolve market manipulation investigations.

The market manipulation investigations were carried out by the US Department of Justice (DOJ) and the Commodity Futures Trading Commission (CFTC).

DOJ criminal division assistant attorney general Kenneth Polite, Jr said: “Glencore’s guilty pleas demonstrate the Department’s commitment to holding accountable those who profit by manipulating our financial markets and engaging in corrupt schemes around the world.

“In the foreign bribery case, Glencore International A.G. and its subsidiaries bribed corrupt intermediaries and foreign officials in seven countries for over a decade. In the commodity price manipulation scheme, Glencore Ltd. undermined public confidence by creating the false appearance of supply and demand to manipulate oil prices.”

In the UK, Glencore was charged by the UK Serious Fraud Office (SFO) with seven counts of profit-driven bribery and corruption relating to its oil operations in Cameroon, Equatorial Guinea, Ivory Coast, Nigeria, and South Sudan.

According to SFO, Glencore’s agents and employees made bribes worth more than $25m to gain preferential access to oil.

Subsequently, the company indicated that it would plead guilty to all charges by the SFO. Penalty for the firm will be determined following a court hearing that is scheduled for 21 June 2022.

In Brazil, Glencore agreed to a $39.5m settlement agreement with the Brazilian Federal Prosecutor’s Office (MPF) for its involvement in the Petrobras ‘Operation Car Wash scandal’.

The miner is also currently under probe in Switzerland and the Netherlands.

Glencore CEO Gary Nagle said: “We acknowledge the misconduct identified in these investigations and have cooperated with the authorities. This type of behaviour has no place in Glencore, and the Board, management team and I are very clear about the culture that we want and our commitment to be a responsible and ethical operator wherever we work.

“We have taken significant action towards building and implementing a world-class Ethics and Compliance Programme to ensure that our core controls are entrenched and effective in every corner of our business.”

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