In mid-2018 Glencore (a commodities company incorporated in the United Kingdom and headquartered in Switzerland with common stock that trades on the New York based over-the-counter market) disclosed that it was under scrutiny by the DOJ. (See here for the prior post).
Specifically, the company disclosed:
“Glencore Ltd, a subsidiary of Glencore plc, has received a subpoena dated 2 July, 2018 from the US Department of Justice to produce documents and other records with respect to compliance with the Foreign Corrupt Practices Act and United States money laundering statutes. The requested documents relate to the Glencore Group’s business in Nigeria, the Democratic Republic of Congo and Venezuela from 2007 to present. Glencore is reviewing the subpoena and will provide further information in due course as appropriate.”
As highlighted in this prior post, in mid-2019 the Commodity Futures Trading Commission (CFTC) joined the fray as the company disclosed:
“Glencore has been informed by the United States Commodity Futures Trading Commission (“CFTC”) that the CFTC is investigating whether Glencore and its subsidiaries may have violated certain provisions of the Commodity Exchange Act and/or CFTC Regulations through corrupt practices in connection with commodities. Glencore understands that the CFTC’s investigations are at an early stage and have a similar scope in terms of subject matter as the current ongoing investigation by the US Department of Justice (“DOJ”). Glencore will cooperate with the CFTC. Glencore’s response will be managed by its Investigations Committee, which was set up in July 2018 to oversee Glencore’s response to the investigation by the DOJ.”
Thereafter, the company disclosed (see here) the following: (1) the United Kingdom Serious Fraud Office is investigating the Group in respect of suspicions of bribery in the conduct of business of the Group; (2) the Brazilian authorities are investigating the Group in relation to “Operation car wash”, which relates to bribery allegations concerning Petrobras; and (3) the Office of the Attorney General of Switzerland is investigating Glencore International AG for failure to have the organisational measures in place to prevent alleged corruption.
As highlighted here, in July 2021 Anthony Stimler (a United Kingdom citizen and resident who was a trader at a Glencore subsidiary who worked on the West Africa desk) pleaded guilty to FCPA and money laundering offenses. According to the DOJ, “In that role, Stimler had responsibility for crude oil purchases from, among other places, Nigeria, and acted on behalf of Company 1 [Glencore] in procuring crude oil from Nigeria.”
Earlier this week, Glencore disclosed:
“Update on Investigations
As previously disclosed, Glencore is subject to a number of investigations by regulatory and enforcement authorities including the U.S. Department of Justice, the U.S. Commodity Futures Trading Commission, the UK Serious Fraud Office and the Brazilian Federal Prosecutor’s Office. Glencore has been cooperating extensively with the various authorities in order to resolve these investigations as expeditiously as possible.
While Glencore cannot forecast with certainty the cost, extent, timing or terms of the outcomes of the investigations, the Company presently expects to resolve the U.S., UK and Brazilian investigations in 2022. Accordingly, and based on the Company’s current information and understanding, the Group has raised a provision as at 31 December 2021 in the amount of $1,500 million representing the Company’s current best estimate of the costs to resolve these investigations. The U.S. resolutions are expected to cover separate investigations into bribery and market manipulation. The resolution of the other investigations into the Group is not included within this provision and they remain ongoing.
We will provide further updates on the investigations at the appropriate time.”