Glencore pays up to $1.5 bn in penalties to resolve corruption claims

Commodities firm Glencore says it has reached deals with authorities in the US, Britain and Brazil to resolve corruption allegations in return for penalties totalling up to $1.5 billion

Commodities firm Glencore says it has reached deals with authorities in the United States, Britain and Brazil to resolve corruption allegations in return for penalties totalling up to USD 1.5 billion.

The Anglo-Swiss company said late Tuesday that it will pay USD 700 million to resolve a US bribery probe and a further USD 486 million in connection with allegations of market manipulation.

Glencore said that about USD 166 million in fines agreed with the US authorities will be credited to a parallel investigation by the UK Serious Fraud Office, where it has indicated that it will plead guilty to bribery at a hearing next month.

Separately, the company is paying USD 40 million to resolve a bribery probe in Brazil.

The US Department of Justice said its case against the company related to a decade-long scheme by Glencore and its subsidiaries to make and conceal corrupt payments and bribes to foreign officials in Africa and Latin America.
 

The scope of this criminal bribery scheme is staggering, US Attorney Damian Williams for the Southern District of New York was quoted as saying. Glencore paid bribes to secure oil contracts. Glencore paid bribes to avoid government audits. Glencore bribed judges to make lawsuits disappear.

At bottom, Glencore paid bribes to make money hundreds of millions of dollars, Williams said. And it did so with the approval, and even encouragement, of its top executives.

Glencore today is not the company it was when the unacceptable practices behind this misconduct occurred, chairman Kalidas Madhavpeddi said in a statement, adding that Glencore was committed to act ethically and responsibly across all aspects of its business.

Glencore said that it does not currently anticipate the total payments to differ materially from the USD 1.5 billion it has set aside so far.

The company remains subject of investigations in Switzerland and the Netherlands.