On March 1, 2024, Gunvor SA, an international commodities trading company based in Switzerland, pleaded guilty to conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act (“FCPA”). According to the Statement of Facts for the Plea Agreement, from about 2012 to 2020, former employees and agents of Gunvor conspired with others to bribe Ecuadorian officials in order to obtain and retain business from Ecuador’s state-owned and state-controlled oil company, Empresa Pública de Hidrocarburos del Ecuador (“Petroecuador”). Gunvor also agreed to pay a fine of approximately $375 million and forfeit approximately $287 million in “ill-gotten gains.”
Gunvor’s sentence includes credits of up to $93 million each for amounts that Gunvor pays to resolve investigations by Swiss and Ecuadorian authorities into the same conduct, provided that the payments are made within 12 months of Gunvor’s plea. On March 1, 2024, the Office of the Attorney General of Switzerland also announced that it had reached a parallel resolution with Gunvor to resolve its investigation into bribes paid to an official at Petroecuador.
According to the Statement of Facts, Gunvor made payments to shell companies created by two consultants who then paid bribes to Ecuadorian officials. The Statement of Facts notes that the consultants created fake invoices for purported consulting services and utilized email accounts with pseudonyms to help facilitate the scheme.
According to a DOJ press release, the DOJ reached its resolution with Gunvor after considering a number of factors, including the nature and seriousness of the offense, Gunvor’s cooperation with DOJ investigators, its timely implementation of remedial measures, and its “history of misconduct.” With respect to Gunvor’s cooperation, the DOJ credited Gunvor for “(i) producing documents to the [DOJ] from multiple foreign countries expeditiously while navigating foreign data privacy and criminal laws; (ii) providing information obtained through its own internal investigation to the [DOJ], which allowed the [DOJ] to preserve and obtain evidence as part of the [DOJ’s] investigation; (iii) making detailed, factual presentations to the [DOJ]; (iv) arranging for the interview of an employee based outside the United States; (v) promptly collecting, analyzing, and organizing voluminous information, including complex financial information, at the request of the [DOJ], and producing an analysis of trading activity conducted by multiple outside forensic accounting firms retained by Gunvor; (vi) translating foreign language documents to facilitate and expedite review by the [DOJ]; and (vii) imaging the phones of relevant custodians at the beginning of Gunvor’s internal investigation, thus preserving business communications sent on mobile messaging applications.”
With respect to remediation, the DOJ noted that Gunvor “(i) eliminat[ed] the use of third-party business origination agents; (ii) enhance[ed] its third party due-diligence process; (iii) develop[ed] and implement[ed] a control framework for internal business developers and additional layers of review and approval for counterparty payments; (iv) enhance[ed] the independent compliance committee with responsibility for reviewing high-risk transactions; (v) engag[ed] resources to review its compliance program and test the effectiveness of its overall reporting process, its reporting hotline and the effectiveness of the investigation of reports made through the hotline; (vi) evaluat[ed] and update[ed] its compensation policy to better incentivize compliance with the law and corporate policies; (vii) hir[ed] additional compliance personnel; (viii) test[ed] and enhance[ed] its compliance program, including by conducting compliance culture reviews, testing new third party due diligence process and payment controls, and evaluating controls around business development activities; and (ix) develop[ed] and implement[ed] a risk-based business communications policy that addresses the use of ephemeral and encrypted messaging applications.”
The DOJ also noted Gunvor’s “history of misconduct” in reaching this resolution, namely, the 2019 settlement between Gunvor and Swiss authorities related to a scheme to bribe officials in the Republic of the Congo and the Republic of Côte d’Ivoire. The approximately $375 million penalty therefore reflects a 25% reduction off the 30th percentile of the applicable US Sentencing Guidelines range.
DOJ Press Release | USAO EDNY Press Release | Statement of Facts for Plea Agreement | Office of the Attorney General of Switzerland Press Release | Gunvor Statement