Glencore facing $1.5bn bill to settle fraud case
Miner admits seven counts of bribery at its oil business in much-needed victory for Serious Fraud Office
MINING giant Glencore will pay settlements of up to $1.5bn (£1.2bn) following an international investigation into bribery allegations.
A New York court was told that Glencore will pay around $1bn in fines to US authorities, including about $166m that will be “credited against other, parallel matters, including in the UK”.
The total amount the company will pay to UK authorities will be determined by a judge following a sentencing hearing next month.
However, Glencore said it did not expect the amount to be paid to UK authorities to take the overall penalties to more than the $1.5bn it has already set aside.
At a hearing in Westminster magistrates’ court yesterday, the Londonlisted company’s subsidiary, Glencore Energy UK Ltd, admitted to seven counts of bribery in connection with the group’s oil business.
The admission followed an investigation by Britain’s Serious Fraud Office (SFO) and the US Department of Justice.
Glencore also pleaded guilty to similar charges in a court in New York.
The company agreed to pay a $429m fine and to forfeit more than $272m to US authorities, a federal judge in New York said. Glencore will pay a total of $1.5bn to settle both the US and UK inquiries, according to Bloomberg.
It is a much-needed victory for the SFO and the agency’s embattled director, Lisa Osofsky, as they face questions over the botched handling of another bribery case.
In a statement, Ms Osofsky said: “This significant investigation, which the Serious Fraud Office has brought to court in less than three years, is the result of our expertise, our tenacity and the strength of our partnership with the US and other jurisdictions.”
The SFO first began the investigation into Glencore in June 2019 and has been working in parallel with US authorities.
The case examined corruption in the company’s oil operations in Cameroon, Equatorial Guinea, Ivory Coast, Nigeria and South Sudan.
Staff and agents of the company, acting with the company’s approval, paid bribes worth more than $25m to secure preferential access to oil, the SFO said.
A court hearing next month will deal with Glencore’s sentencing. No individuals have been charged.
Kalidas Madhavpeddi, the mining giant’s chairman, said yesterday: “Glencore today is not the company it was when the unacceptable practices behind this misconduct occurred.”
Shares in the company closed 1pc higher as investors expressed relief that the investigation was drawing to a close.
The win for the SFO comes at a crucial time, as the white collar crime agency’s disastrous handling of the bribery investigation into consultancy firm Unaoil is being examined by Sir David Calvert-smith, an ex-high Court judge.