Greek ship­ping com­pa­nies fined $1.5M for pol­lu­tion, cover-up

Malta Independent - - ENVIRONMENT -

A fed­eral judge in Seat­tle on Fri­day or­dered two com­pa­nies owned by a Greek ship­ping mag­nate to pay $1.5 mil­lion af­ter a jury found that a cargo ship de­lib­er­ately pumped oil-pol­luted wa­ter into the ocean, then re­peat­edly lied and fal­si­fied records in an ef­fort to de­ceive in­spec­tors with the U.S. Coast Guard.

Au­thor­i­ties hailed the sen­tence Fri­day as a rare suc­cess in hold­ing cor­po­rate de­fen­dants ac­count­able for pol­lu­tion on the high seas, an of­fense they de­scribe as no­to­ri­ously dif­fi­cult to de­tect and prove.

U.S. Dis­trict Judge John Coughenour said he was trou­bled by the ac­tions of Gal­lia Graeca LTD and An­ge­lakos (Hel­las) SA, which are part of a fam­ily of com­pa­nies ul­ti­mately owned by Greek ship­ping mag­nate Evan­ge­los An­ge­lakos, and wanted to send a mes­sage “that will res­onate with other par­ties in this in­dus­try and cause them to pause when they think about cre­at­ing a cor­po­rate cul­ture that en­cour­ages de­cep­tion.”

The ves­sel, the Gal­lia Graeca, ar­rived at the Pier 86 grain ter­mi­nal on Seat­tle’s wa­ter­front from China in Oc­to­ber 2015 to pick up a $20 mil­lion ship­ment of soy­beans. When Petty Of­fi­cer Daniel Hamil­ton came aboard to con­duct a gen­eral in­spec­tion, sev­eral things seemed off, he said Fri­day af­ter the sen­tenc­ing. Valves were mis­aligned, oil ap­peared where it shouldn’t have, and a de­vice called the oil-wa­ter sep­a­ra­tor did not ap­pear to have been main­tained.

“Ev­ery step I went fur­ther, an­other red flag would come up,” he said.

Ul­ti­mately, pros­e­cu­tors dis­cov­ered that 5,000 gal­lons of oil­fouled bilge wa­ter had been dumped at sea, but that in­spec­tors were pre­sented with an of­fi­cial log book show­ing no such dis­charges. Fur­ther­more, when en­gi­neers demon­strated the op­er­a­tion of the oil-wa­ter sep­a­ra­tor for the Coast Guard, they did so in a man­ner de­signed to trick the in­spec­tors into be­liev­ing it was work­ing.

In rec­om­mend­ing a to­tal fine of just $100,000, Ge­orge Cha­los, a New York at­tor­ney for the com­pa­nies, ar­gued that the mis­con­duct was com­mit­ted by rogue em­ploy­ees with­out the knowl­edge or ap­proval of man­age­ment, and that the com­pa­nies stood to gain noth­ing by fal­si­fy­ing the records. The com­pa­nies had no prior crim­i­nal his­tory and are com­mit­ted to pro­tect­ing the en­vi­ron­ment, he said.

But the U.S. At­tor­ney’s Of­fice, which rec­om­mended a $3 mil­lion fine, said ship­ping com­pany ex­ec­u­tives had been in touch with the ves­sel’s en­gi­neers about how they should present the log book to the Coast Guard. The com­pa­nies’ mo­tives were to try to avoid be­ing de­tained in Seat­tle for en­vi­ron­men­tal non­com­pli­ance so the valu­able soy­bean ship­ment could de­part on sched­ule, as­sis­tant U.S. at­tor­neys Seth Wilkin­son and Matt Diggs ar­gued.

Pros­e­cu­tors also sug­gested — and the judge con­curred — that a cor­po­rate of­fi­cial lied on the wit­ness stand when he claimed to have per­son­ally per­formed the lowly task of clean­ing the oil­wa­ter sep­a­ra­tor just be­fore the ves­sel sailed.

In June, the jury con­victed the com­pa­nies, along with the ves­sel’s chief and sec­ond en­gi­neers, of charges re­lated to pol­lu­tion, fal­si­fi­ca­tion of records and fraud. The en­gi­neers each re­ceived 10 days in jail.

Pros­e­cu­tors noted that de­lib­er­ate dump­ing of oil at sea is a lead­ing killer of seabirds.

The Coast Guard an­nu­ally refers about a dozen cases of high-seas pol­lu­tion to the Jus­tice Depart­ment, but it’s rel­a­tively rare for pros­e­cu­tors to be able to doc­u­ment the dis­charges or cover-ups in a way that en­ables them to hold cor­po­ra­tions — in ad­di­tion to in­di­vid­u­als — crim­i­nally li­able.

In the North­west, about one in ev­ery five for­eign-flagged ship that docks in port is in­spected by the Coast Guard. Of 2,200 in­spec­tions in the last five years, the Gal­lia Graeca is just the sec­ond that re­sulted in crim­i­nal pros­e­cu­tion, Capt. Brian Gilda, the agency’s top en­vi­ron­men­tal of­fi­cer in the North­west, told the judge.

“Most of­ten we find that ships are sub­stan­tially com­ply­ing with in­ter­na­tional reg­u­la­tions,” Gilda said. “But we still, due to cases like this, con­tinue to sus­pect that a mi­nor­ity of all ship­ping com­pa­nies ... are putting fi­nan­cial con­sid­er­a­tions above en­vi­ron­men­tal com­pli­ance and stew­ard­ship.”

The judge or­dered the com­pa­nies to di­rect $200,000 of the penalty to the Na­tional Parks Foun­da­tion and the Na­tional Fish and Wildlife Foun­da­tion; put them on pro­ba­tion for five years; and said they must adopt en­vi­ron­men­tal com­pli­ance plans.

The com­pa­nies’ lawyer re­quested a five-year pay­ment plan for the fine, cit­ing tough times in the ship­ping in­dus­try. The judge wasn’t moved. “No,” he said curtly. “It’s due.”

This un­dated US Coast Guard photo, in­tro­duced as ev­i­dence in the trial against its own­ers in a pol­lu­tion case, shows the cargo ship Gal­lia Graeca in Seat­tle

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