Gunvor FCPA guilty plea and Swiss conviction over Ecuador (2024)
- Entity
- Gunvor S.A., a commodities trader based in Switzerland 1
- US agencies
- DOJ Criminal Division Fraud Section and the U.S. Attorney's Office for the Eastern District of New York 1,2
- Judge
- U.S. District Judge Eric N. Vitaliano 2
- Charge
- One count of conspiracy to violate the anti-bribery provisions of the FCPA 1
- US total
- More than US$661 million: criminal fine US$374,560,071 and forfeiture US$287,138,444 1
- Foreign credits
- Up to one-quarter of the fine each for Swiss and Ecuadorean payments made within one year 1. The EDNY release puts each credit at up to US$93 million 2
- Swiss outcome
- Nearly CHF 86.7 million, including a CHF 4.3 million fine 3
The US plea and sentence
The U.S. Attorney's Office for the Eastern District of New York said Gunvor pleaded guilty on 1 March 2024 and that Judge Eric N. Vitaliano imposed sentence the same day 2. Gunvor pleaded guilty to one count of conspiracy to violate the anti-bribery provisions of the FCPA 1.
DOJ said the criminal fine reflects a 25% reduction off the 30th percentile of the Sentencing Guidelines fine range, reflecting cooperation, remediation and prior history 1. The release does not say Gunvor voluntarily self-disclosed the conduct, and it names no independent compliance monitor 1.
Conduct described by DOJ
DOJ said that "according to the company's admissions and court documents," between 2012 and 2020 Gunvor and its co-conspirators paid more than US$97 million to intermediaries, knowing some of it would be used to bribe officials at Petroecuador, Ecuador's state-owned oil company 1.
According to DOJ, the bribes were routed through US banks using shell companies in Panama and the British Virgin Islands 1. DOJ said the officials helped state-owned entities acting as front companies win oil-backed loan contracts with Petroecuador without competitive bidding, and that Gunvor earned more than US$384 million in profits from those contracts 1.
The Swiss conviction
On 1 March 2024 the Office of the Attorney General of Switzerland issued a release titled "GUNVOR SA held criminally liable for acts of corruption in Ecuador" 3. It said Gunvor "did not take all the reasonable and necessary organisational measures" to prevent its employees from bribing foreign public officials in its petroleum activities in Ecuador from February 2013 to February 2017 3.
The Swiss authority said Gunvor was sentenced to pay nearly CHF 86.7 million, including a fine of CHF 4.3 million, in a coordinated outcome with US authorities 3. The Swiss release does not break down the rest of that sum 3.
DOJ said the US sentence includes credits of up to one-quarter of the criminal fine each for amounts Gunvor pays to resolve Swiss and Ecuadorean investigations into the same conduct, if paid within one year 1. The EDNY release describes these as credits of up to US$93 million each 2. This page has not confirmed any Ecuadorean resolution from an Ecuadorean official source.
Prior history and related individuals
DOJ said Gunvor reached a resolution with the Office of the Attorney General of Switzerland in October 2019 over bribery of officials in Congo-Brazzaville and Côte d'Ivoire, in which Gunvor admitted it lacked sufficient controls 1,2.
DOJ listed four individuals convicted in the Eastern District of New York 1. Former consultants Antonio Pere Ycaza and Enrique Pere Ycaza pleaded guilty on 7 October 2020 1. Former employee and agent Raymond Kohut pleaded guilty on 6 April 2021 to money laundering conspiracy 1. Former senior Petroecuador official Nilsen Arias Sandoval pleaded guilty on 19 January 2022 to money laundering conspiracy 1.
Common questions
Did Gunvor admit wrongdoing?
Yes. Gunvor S.A. pleaded guilty in the US to conspiracy to violate the FCPA 1. Swiss prosecutors said it was held criminally liable 3.
How much did Gunvor pay?
DOJ said more than US$661 million in the US 1. The Swiss outcome was nearly CHF 86.7 million 3. DOJ credits some foreign payments against the US fine 1.
Who was bribed?
DOJ said officials at Petroecuador, Ecuador's state-owned oil company 1.
Is this Gunvor's first bribery case?
No. DOJ said Gunvor resolved a Swiss case over Congo-Brazzaville and Côte d'Ivoire in October 2019 1.
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Sources
- U.S. Department of Justice, Office of Public Affairs: Commodities Trading Company Will Pay Over $661M to Resolve Foreign Bribery Case, release 24-237 (1 March 2024)
- U.S. Attorney's Office, Eastern District of New York: Gunvor S.A. Pleads Guilty to Scheme to Bribe Ecuadorian Officials and Is Ordered to Pay Over $600 Million (1 March 2024)
- Office of the Attorney General of Switzerland, via admin.ch: GUNVOR SA held criminally liable for acts of corruption in Ecuador (1 March 2024)
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