Exclusive commodity trader free points face US bribery investigations, sources say

Exclusive commodity trader free points face US bribery investigations, sources say

[ad_1]

The sign with the Freepoint Commodities LLC logo is painted outside its headquarters in Stamford, Connecticut, USA, on May 28, 2021. Photo taken on May 28, 2021. REUTERS / Mike Segar

Rio de Janeiro / Washington, July 23 (Reuters)-US Department of Justice investigates Connecticut-based trading company Freepoint products to see if payments to employees of Brazilian state-owned oil companies violate US law Two sources with knowledge of the issue told Reuters this week.

A criminal investigation led by a Washington prosecutor complements a separate ongoing bribery investigation into the company by Brazilian authorities, sources said who demanded anonymity to discuss confidential matters. rice field.

Brazilian prosecutor claims Petroleo Brasileiro SA’s Freepoint bribed employees (PETR4.SA), Or Petrobras, about 7 years until 2018. The Justice Department is also investigating these alleged payments and whether they may have violated US anti-antitrust laws, sources said. One said the US investigation was relatively advanced.

A spokesperson for the Justice Department declined to comment.

A Freepoint spokesperson wrote in an email that the company is “strongly committed to complying with the law everywhere we do business.” The Stanford-based company declined further comments.

“We will not tolerate any fraud or corruption,” Petrobras said in an email, and employees involved in fraud in the trading sector were “immediately dismissed in 2018 for good reason.” He added that he has extensively supported Brazilian authorities in various corruption-related investigations.

Reuters reported last month that Brazilian prosecutors were investigating free points, citing hundreds of pages of court documents and three sources, but a Judiciary investigation fined businesses. Having a wide range of powers to curb businesses has significantly increased pressure on businesses. .. read more

Authorities in both countries are investigating whether Freepoint bribed Petrobras employees and whether payments were laundered through banks in third-party countries such as Switzerland and Uruguay, sources said. Stated.

The investigation did not necessarily indicate fraud, and it was unclear whether prosecution would be prosecuted in either jurisdiction.

This investigation is the latest in extensive promotion by US authorities to eradicate fraud and fraud within the commodities sector. Commodity traders who buy and sell raw materials are at risk of violating US law, which prohibits the payment of bribes to foreign civil servants, as corruption often operates in common jurisdictions.

Product crackdown

Commodity traders around the world connect producers and consumers and make cuts in the process. Founded in 2011 by former Sempra Energy Trading executives, Freepoint employs more than 500 people worldwide and trades energy, metals and agricultural products.

Investigating allegations of bribery and corruption has been a central task of the DOJ’s fraud department, but over the last two years, we have established a subunit dedicated to this department and strengthened our product expertise.

Commodity trading companies are usually not a common name, but they have a lot of power. The total annual revenue of the world’s top five commodity traders is about the same as Saudi Arabia’s gross domestic product. They trade over 20 million barrels of petroleum products annually.

Switzerland’s Vitol SA (VITOLV.UL), the world’s top independent oil trader, has agreed to pay $ 164 million to resolve allegations of corruption in the United States and Brazil, including a December settlement. Regulators are increasingly targeting these companies for fraud. In April, a former Gunvor employee pleaded guilty to a US plea for paying a bribe in Ecuador. read more

In the case of Freepoint, a court document filed by a Brazilian investigator in 2020 suspected that company employees bribed Petrobras employees through intermediaries approximately between 2012 and late 2018. I have.

In return, these employees allegedly provided Freepoints with information about the amount of money their competitors bid to ship Petrobras fuel oil, a petroleum product commonly used for power generation and home heating. .. Petrobras, the world’s seventh-largest oil producer, regularly auctions large shipments of various fuels to ensure that it gets the best possible price for its products.

According to a Brazilian court document reviewed by Reuters, its internal knowledge allowed Freepoints to beat its competitors in these auctions, but still allow the company to pay less than other methods. It is said that

Freepoint allegedly bribed Petrobras for nearly $ 500,000 through an intermediary between August 2017 and November 2018.

Report of Gram Slutary in Rio de Janeiro and Chris Prentice in Washington Additional report by Sabrina Barre in Houston, Giulia Pain in London, Alexandria Valencia in Quito Edited by Matthew Lewis

Our criteria: Thomson Reuters Trust Principles.

Exclusive commodity trader free points face US bribery investigations, sources say

Source link Exclusive commodity trader free points face US bribery investigations, sources say

[ad_2]
Source link