Oil trader Gunvor sets aside 450 million to pay corruption fines
Swiss trader Gunvor has reported a decline in profits in the first half of this year and has more than doubled the provision for the expected fine in the pending corruption case involving him that could hurt his bottom line.
The global energy trader raised the amount set aside to cover administrative fines to $450 million, up from $200 million set aside in 2022.
A former Gunvor employee pleaded guilty in 2021 to a scheme to bribe Ecuadorian government officials in an attempt to get business.
Gunvor also saw its first-half net income slip to $803 million from $841 million in the corresponding period last year, citing lower price volatility in the oil and gas markets.
In 1977, the US Congress enacted the Foreign Corrupt Practices Act (FCPA) following the discovery of widespread corruption in the wake of the Watergate political scandal. The FCPA prohibits individuals and companies from bribing foreign officials to obtain or retain contracts. The FCPA has been amended several times and gained a reputation as one of the most effective cross-border anti-corruption laws in the world, but not all of them comply with such a serious standard.
FCPA: a curse for the US oil & gas sector
While FCPA violations have been uncovered hundreds of times across industries, the global oil and gas industry has developed an enviable reputation for overseas bribery and bribery and has seen an increased number of enforcement of the FCPA than any other industry. In 2010, the SEC opened investigations into corruption in the oil and gas industry and uncovered an elaborate scheme in which seven companies paid millions of dollars in bribes to foreign officials.
For example, Panalpina Inc, a US subsidiary of shipping company Panalpina World Transport, was found guilty of paying millions of dollars in bribes between 2002 and 2007 to foreign government officials on behalf of oil industry customers.
At least six major oil companies and their subsidiaries were involved: Shell Plc, Pride International Inc., Tidewater Inc., Transocean, GlobalSantaFe Corp, and Noble Corp. Plc..
That said, the vast majority of violations committed by Big Oil that result in fines are environmental in nature. Shell has received fines more frequently than most other oil and gas companies: of the 621 fines imposed so far, 485 relate to environmental violations. This does not mean that there are no cases of corruption, but that large companies manage to handle them adequately and far
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The article The oil trader Gunvor sets aside 450 million to deal with corruption fines comes from Scenari Economici .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/il-trader-petrolifero-gunvor-accantona-450-milioni-per-far-fronte-alla-multe-per-corruzione/ on Sun, 27 Aug 2023 16:45:26 +0000.