(Bloomberg) — A former executive at Gunvor Group stands trial for bribery on Monday, throwing the spotlight on one of Geneva’s biggest oil-trading firms and Switzerland’s controversial light-touch regulation of commodity houses.
Most Read from Bloomberg
G., an ex-trade finance executive at the firm, was actively involved in a scheme to make payments worth $35.5 million to public officials in the Republic of Congo to secure financing and delivery of crude oil from the African nation, according to the indictment.
The man, who can’t be named under Swiss reporting restrictions, is scheduled to appear at the Federal Criminal Court in Bellinzona. A conviction for bribery carries a sentence of as much as five years in Switzerland. Alec Reymond, G.’s lawyer, and Gunvor declined to comment ahead of the trial.
G’s trial follows the guilty verdict for another former oil trader with Gunvor, identified as C., who was given an 18-month suspended jail sentence in 2018 after bribing public officials to secure oil cargoes from the Republic of Congo and Ivory Coast. The following year, Gunvor paid $95 million to end a long-running Swiss probe into the company’s involvement. It was during the course of those two proceedings that evidence emerged to try G., Swiss federal prosecutors said in their 2023 indictment.
Another conviction would be a boost for Swiss prosecutors keen to demonstrate that they’re cracking down on commodity-trading companies as much as the justice system allows, even if Switzerland became an oil and metals-trading hub precisely because of its laissez-faire regulation.
Two Geneva businessmen were last month convicted of a $1.8 billion fraud over a sham oil exploration company they created which feigned links to Saudi royals. A former senior Trafigura Group executive faces trial in December charged with bribing officials in Angola to smooth its oil operations there.
Gunvor and other commodity trading houses have faced pressure, particularly from US prosecutors from a series of investigations in recent years that have helped expose a widespread culture of corruption across the industry. Gunvor also pleaded guilty and agreed this year to pay $662 million to resolve US and Swiss charges over corruption in Ecuador.
Smiley Faces
Prosecutors pointed in their indictment to email exchanges between C. and G. that they say demonstrated G. knew he was generating false receipts for the millions paid as part of the bribery scheme, but that the pair needed to be more compelling to pass muster with the banks handling them.
In total, prosecutors pointed to more than 35 payments ranging from as little as $150,000 to as much as $3.5 paid to middlemen via banks in Geneva and Brussels at the heart of the bribery.
“Try to use different wordings in these bills please,” G. wrote to C. in March, 2011, otherwise “it becomes a bit ‘obvious’ and bank compliance could come down on us.” C. told the court during his 2018 trial that G. “again used a smiley” in an email, according to the indictment.
“That’s a discreet signal as to the fact that you cannot write the word ‘corruption’ in an internal email and that you know what it’s about,” he was quoted as saying by prosecutors.
Paris Restaurant
G. even told an associate of the president of the Republic of Congo’s son in a restaurant in Paris in 2014 that he was fully aware of the bribes, the prosecutors said, citing video evidence.
G., the prosecutors said in summing up their case against him, left no doubt in his emails to C. “that he was fully aware of and accepted the corruptive nature of the payments made to the agents mentioned above, and that their challenge was to ‘break’ the compliance controls carried out by the banks.”
They said his use of words like “we” and “let’s” had “demonstrated that he participated fully and unreservedly in carrying out of the acts of corruption also committed by C..”
C. was given a suspended 18-month prison sentence, subject to him not committing further crimes over the subsequent three years.
–With assistance from Archie Hunter.
(Adds details from indictment in last three paragraphs)
Most Read from Bloomberg Businessweek
©2024 Bloomberg L.P.
From: Yahoo.com
Financial News
