EXCLUSIVE Commodity trader Freepoint faces U.S. bribery probe, sources say
The U.S. Justice Department is investigating Connecticut-based trading house Freepoint Commodities over whether payments to employees of Brazil's state-run oil company broke U.S. laws, two sources with knowledge of the matter told Reuters this week.
Brazilian prosecutors allege Freepoint bribed employees of Petroleo Brasileiro SA(PETR4.SA), or Petrobras, for a period of roughly seven years ending in 2018. The Justice Department is also probing those alleged payments and whether they may have breached U.S. antibribery law, the sources said. One of the people said the U.S. probe is relatively advanced.
A spokesperson for the Department of Justice declined to comment.A Freepoint spokesperson wrote in an email that the company "is strongly committed to following the laws everywhere we do business." The Stamford-headquartered firm declined further comment.
Petrobras said in an email it has "zero tolerance in relation to fraud and corruption" and that employees involved in wrongdoing in its trading unit "were immediately fired for just cause in 2018." It added that it has aided Brazilian authorities extensively with various corruption-related probes. headtopics.com
Reuters reported last month that Brazilian prosecutors were probing Freepoint, citing hundreds of pages of court documents and three sources, but the probe by the Justice Department - which has extensive powers to fine companies and curb their operations - significantly turns up the pressure on the company.
read moreAuthorities in both countries are investigating whether Freepoint passed bribes to Petrobras employees and whether payments were laundered through banks in third-party countries such as Switzerland and Uruguay, the sources said.Probes do not necessarily indicate wrongdoing and it was unclear whether any charges would be brought in either jurisdiction.
The inquiry marks the latest in a broad push by U.S. authorities to root out fraud and misconduct within the commodities sector. Commodities traders, which buy and sell raw materials, often operate in jurisdictions where corruption is common, putting them at risk of running afoul of a U.S. law that prohibits paying bribes to foreign officials.
COMMODITIES CRACKDOWNGlobal commodity traders connect producers and consumers, taking a cut along the way. Founded in 2011 by former Sempra Energy Trading executives, Freepoint has more than 500 employees globally and trades energy, metals and agricultural products. headtopics.com
Investigating allegations of bribery and corruption has long been core work for the DOJ's Fraud Section, but the agency has beefed up its expertise in commodities in the last two years, establishing a sub-unit dedicated to the sector.While commodity trading houses are not typically household names, they hold immense power. The combined annual revenue of the world's top five commodity traders is roughly equivalent to the gross domestic product of Saudi Arabia. They trade over 20 million barrels of oil products annually.
Global regulators increasingly have been targeting these firms for misconduct, including a December settlement in which Switzerland's Vitol SA (VITOLV.UL), the world's top independent oil trader, agreed to pay $164 million to settle corruption allegations in the United States and Brazil. In April, a former Gunvor employee pled guilty to U.S. charges for paying bribes in Ecuador.
read moreIn the case of Freepoint, company employees are suspected to have routed bribes to Petrobras employees via a middle man from roughly 2012 to late 2018, according to court documents submitted by Brazilian investigators in 2020.In return, those employees allegedly tipped off Freepoint about the amount its competitors bid for shipments of Petrobras fuel oil, a petroleum product commonly used for power production and home heating. Petrobras, the world's seventh-largest oil producer, routinely auctions large shipments of various fuels to ensure it obtains the best price possible for its products.
That inside knowledge allegedly allowed Freepoint to edge out competitors in those auctions, while still allowing the company to pay less than it otherwise might have, according to the Brazilian court documents reviewed by Reuters.Freepoint allegedly funneled nearly $500,000 in bribes to Petrobras through a middle man between August 2017 and November 2018 alone, those documents show. headtopics.com
Reporting Gram Slattery in Rio de Janeiro and Chris Prentice in Washington Additional reporting by Sabrina Valle in Houston, Julia Payne in London and Alexandria Valencia in Quito Editing by Matthew LewisOur Standards:More from ReutersSign up for our newsletter
Subscribe for our daily curated newsletter to receive the latest exclusive Reuters coverage delivered to your inbox. Read more: Reuters Top News »
North Korea fires ballistic missiles in 2nd test in a week
North Korea fired two ballistic missiles toward the East Sea on Wednesday, according to South Korea’s Joint Chiefs of Staff.
EXCLUSIVE China's CCPC takes centre stage in Iran, Venezuela oil trade-sourcesA Chinese logistics firm has emerged as a central player in the supply of sanctioned oil from Iran and Venezuela, even after it was blacklisted by Washington two years ago for handling Iranian crude, seven sources with knowledge of the deals told Reuters.
EXCLUSIVE Former top U.S. consumer regulator joins crypto risk monitoring firmCryptocurrency startup Solidus Labs has hired the former director of the U.S. Consumer Financial Protection Bureau (CFPB) as its top regulatory official, she told Reuters.
U.S. to impose sanctions on Cuban officials over crackdown on protests -sourcesThe Biden administration plans to announce U.S. sanctions on Thursday against several Cuban officials over their role in a crackdown on anti-government protests earlier this month, people familiar with the matter said. What about the states in the US that have cracked down on the right to protest… how about getting on their ass About time. In addition to the sanctions and embargo already in place
Seems Like Adele Has a New BoyfriendSources say the singer is “100 percent” dating LeBron James’s agent.
James Blake Announces New Album 'Friends That Break Your Heart'James Blake has announced his new album, 'Friends That Break Your Heart,' and with it, the first single 'Say What You Will' and a U.S. tour. What’s the B-Side? Why do you always disappoint me? Does anyone know any good spaghetti recipes 🤔 Someone needs to tell James that he has all the talent in the world, but he can’t write songs for shit and he needs to stop using the same whine vocals in every fucking song
WSJ News Exclusive | U.S. Expands Efforts to Relocate Afghans at Risk of Taliban VengeanceThe U.S. military is preparing to house as many as 35,000 Afghan interpreters and family members at the two bases, in an expanding effort to aid those who face Taliban retribution for helping American forces. 1 ️⃣ Watch CNN's report:about the fuel ships released at the end of March2021 AD and the statement of the Executive Director General of the Yemeni Oil Company Eng.Ammar to the channel OSE_Yemen hrw_ar UNarabic nimaelbagir JoeBiden The first clip Thread by noamen13: AmmarAladrai ChiefSharpNoise GhalebM0nz1i7 JoeBiden POTUS OSE_Yemen UNReliefChief hrw_ar UNarabic Watch the American channel CNN and its reporter who visited Yemen expose the Biden administration and his envoy A surprising investigation by CNN reveals how the situation on the ground in Yemen, and found it extremely catastrophic ' Resulting from the blockade and piracy on fuel ships by the coalition of aggression and America.