'Bribery Allegations' Bitol Reaches $163 Million Fine Settlement with U.S. Department of Justice

Bribery Allegations in Brazil, Ecuador, and Mexico

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] Multinational energy company Vitol has agreed to pay $163 million (approximately 176.4 billion KRW) to resolve legal issues involving employees who bribed officials to gain advantages in crude oil auctions held in Brazil, Mexico, and Ecuador, according to reports by The Wall Street Journal (WSJ) and others on the 3rd (local time).

According to the reports, the U.S. Federal Court in Brooklyn disclosed the agreement between Vitol and the U.S. Department of Justice, stating that "Vitol bribed government officials in Brazil, Ecuador, and Mexico to secure profitable contracts and gain unfair competitive advantages."

Vitol employees bribed Petrobras officials, the Brazilian state-owned energy company, with $8 million between 2005 and 2014, and from 2015 to 2020, they paid $2 million in Ecuador and Mexico to obtain information and secure business, resulting in guilty verdicts. In addition, Vitol faced allegations of attempting to manipulate the international oil price benchmark published by S&P Global Platts between 2014 and 2015.

The agreement also includes a deferred prosecution arrangement with the Department of Justice, allowing Vitol to avoid prosecution if no bribery-related issues arise over the next three years. However, Vitol agreed to pay $90 million in fines to the Department of Justice and $45 million to Brazilian authorities. Furthermore, the U.S. Department of Justice stated that Vitol will return $12.7 million in ill-gotten gains plus a $16 million fine to the Commodity Futures Trading Commission (CFTC).

As one of the world's largest energy companies, Vitol acknowledged the bribery charges through this agreement and committed to strengthening internal reporting and legal compliance functions. Vitol stated that it has been working closely with authorities for this agreement and expressed an official position saying, "We understand the seriousness of this matter and are pleased to resolve it." However, foreign media reported that Vitol neither admitted nor denied the allegations related to oil price benchmark manipulation.