Commodities trader Glencore settles US bribery probe for $1bn and pleads guilty to UK charges

Anglo-Swiss commodity trading and mining firm Glencore has settled bribery and market manipulation investigations brought by authorities in the US, UK and Brazil for a total of $1.1bn, although probes in Switzerland and the Netherlands are ongoing.

In addition, Glencore Energy UK said it will plead guilty to five counts of bribery charges and two counts of failure to prevent bribery brought by the UK’s Serious Fraud Office (SFO), which alleged Glencore agents and employees at its operations in Africa paid bribes in excess of $25m for preferential access to oil.

The company set aside provisions totalling $1.5bn in its 2021 accounts to settle regulatory action, which it said should be enough to cover both the newly announced settlements and the SFO fine due to be set at a sentence hearing on 21 June.

Under the detail of the settlements, Glencore will pay a net sum of $1bn to the US authorities – $700.6m to resolve bribery investigations and $485.6m for commodity price manipulation in US fuel oil markets – after a $165.9m charge was offset for payments to settle similar allegations in the UK and other jurisdictions. A further $39.6m will be paid to Brazil’s Federal Prosecutor’s Office, Glencore said.

In addition to the fines, Glencore has agreed with the US Department of Justice to appoint independent compliance monitors for three years at Glencore International AG and Glencore Ltd, to assess the effectiveness of their compliance programmes and internal controls.

Glencore said it did not know how long it would take to resolve investigations by the Office of the Attorney General of Switzerland into Glencore International for failure to prevent alleged corruption, which is also the issue at the centre of a similar investigation by the Dutch Public Prosecution Service.

Glencore said in a statement that it has already removed or disciplined employees involved in the wrongdoing and has put in place a new board and management team. Glencore admitted the practices under investigation were “unacceptable”.

CEO of Glencore Gary Nagle said: “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.”

Kalidas Madhavpeddi, chairman of Glencore, said: “Glencore today is not the company it was when the unacceptable practices behind this misconduct occurred.”

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