Gunvor to Pay Over $661 Million to Settle FCPA Charges Related to Bribe Payments in Ecuador
Gunvor S.A., a wing of global commodities trading giant Gunvor Group, pleaded guilty on March 1 to conspiracy to violate the Foreign Corrupt Practices Act as part of a scheme to bribe officials of Petroecuador, the Ecuadorian state-owned oil company, and the Ecuadorian Ministry of Hydrocarbons. Gunvor was ordered to pay a $661 million criminal penalty for bribing the officials to receive contracts to buy oil products, the U.S. Attorney's Office for the Eastern District of New York announced.
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Specifically, the plea deal will see Gunvor pay a $374 million monetary penalty and forfeit over $287 million "in ill-gotten gains." The trading firm will be credited up to $93 million for each payment to settle investigations by Swiss and Ecuadorian authorities of the scheme "so long as the payments are made within 12 months of today's date," the U.S. Attorney's Office said.
From 2012 to 2020, Gunvor paid over $97 million to intermediaries to bribe Ecuadorian officials. The payments were sent through U.S. banks via shell companies in Panama and the British Virgin Islands. The officials then helped Gunvor win contracts "to provide a series of oil-backed loans" to the state-owned oil company. These loans were made through other state-owned firms, which acted as a "front" for Gunvor, so that the company could skirt the usual bidding process.
The U.S. Attorney's Office said Gunvor earned over $384 million in profits from the business it received from the scheme. The plea deal was purportedly reached based on a variety of factors, "including the nature and seriousness of the offense," Gunvor's "history of misconduct" and the firm's cooperation and remediation. The penalty is a 25% reduction off the "30th percentile of the applicable U.S. sentencing guidelines fine range," the U.S. Attorney's Office said.