Third-party agents used Glencore’s money to bribe officials in Nigeria, Cameroon, Ivory Coast, Equatorial Guinea and South Sudan, causing losses of $128 million, a sentencing hearing at Southwark Crown Court heard. A British subsidiary of the FTSE 100 company pleaded guilty in June to five counts of bribery and two counts of failing to prevent bribery brought by the UK’s Serious Fraud Office (SFO). Alexandra Healy KC, counsel for the SFO, told the court that Glencore was involved in paying $27 million worth of bribes. The $128 million in damages was worth £81 million at the time of the offenses and was “approved at a senior level”, Healy said. The SFO reviewed more than 1 million documents, including extensive email conversations and WhatsApp instant messages, and conducted 16 interviews as part of the large and complex investigation. Former Glencore boss Ivan Glasenberg, who was chief executive throughout the offending, was not among those questioned by the SFO. In a sign of the importance of the case to the SFO, its director, Lisa Osofsky, visited the agency’s case team at Southwark Crown Court ahead of the hearing. Glencore chairman Kalidas Madhavpeddi attended the hearing in person, which Glencore counsel Clare Montgomery KC described as a sign of a “change in culture” at the company. “The behavior was inexcusable,” Montgomery said. “The company deeply regrets the damage caused by these offences.” The bribery was first detected by the FBI in 2017, and Glencore agreed in May to pay $1.1 billion to US authorities for violations of bribery laws and manipulation of commodity prices. The judge at Southwark Crown Court, Mr Justice Fraser, is expected to sentence Glencore Energy UK Ltd on Thursday, taking into account the harm Glencore admitted and other factors such as how culpable the company was. Healy argued that it was considered a more serious offense because the company played a “leading role in organized, planned, illegal activity” that was “sanctioned at a higher level”. However, Glencore expects the penalties it is likely to pay in the UK to be smaller than in the US. In May, he said he did not anticipate having to set aside more than the previous $1.5 billion to cover all bribery-related costs. The court heard detailed accounts of how Glencore and its agents repeatedly tried to bribe public officials. In one case, an agent told Glencore to speed up cash payments because it had “staff to enjoy before Christmas” – a reference to a bribe in Nigeria. In another case, a Glencore agent boasted in an email that he had secured crude shipments from Equatorial Guinea’s state oil companies after using family connections to meet the country’s president, Teodoro Nguema Obiang, who has ruled the country since 1979. Subscribe to Business Today Get ready for the business day – we’ll point you to all the business news and analysis you need every morning Privacy Notice: Newsletters may contain information about charities, online advertising and content sponsored by external parties. For more information, see our Privacy Policy. We use Google reCaptcha to protect our website and Google’s Privacy Policy and Terms of Service apply. Glencore employees were also directly involved in withdrawing cash to be used in bribes. The SFO successfully requested anonymity for several former officers and agents during the trial because it is considering further charges. The SFO described how a Glencore trader in its West African office withdrew a total of €6.3m (£5.4m) in cash from the company’s coffers in Baar, Switzerland, to fund bribes on 25 separate occasions between 2012 and 2015. These waivers had to be signed by senior officials, one of whom was Glencore’s “business ethics officer” and the other a member of the company’s “business ethics committee.” In South Sudan, Glencore officials traveled by private jet to the country shortly after independence in 2011 with $800,000 in cash. This cash was falsely described as “opening an office in South Sudan, cash for office infrastructure, salaries, cars, etc.” but was instead handed over to agents who used it to bribe officials. “Within days of the cash arriving [the capital] Juba on August 2, 2011, Glencore’s fortunes changed” and won valuable contracts, SFO counsel said. Healy said there was “a stark contrast between the true culture of the company and the one set out” in its anti-money laundering policies. The SFO conducted 72 hours of interviews with Anthony Stimler, a former Glencore trader who pleaded guilty to US bribery charges last year. Stimler said “the bribery that I saw then, and in the second phase that I was involved in, was condoned” by a senior Glencore employee.
