Photo: Illustration; Source: Petrobras

Vitol pays $45 million to Petrobras in corruption settlement

Brazilian state-run oil company Petrobras has received $44.65 million in a settlement with Swiss energy trading firm Vitol, which was implicated in a sprawling national corruption probe.

According to a Reuters article, Petroleo Brasileiro – Petrobras as it is formally known – said in a securities filing that the settlement was brokered as part of a leniency deal between Vitol and federal prosecutors.

The wide-ranging probe, known as Operation Car Wash (Lava Jato), uncovered companies paying bribes for Petrobras contracts and has implicated hundreds of business and government officials.

The Brazilian company added that it had recovered 4.8 billion reais ($921.2 million) in settlements and compensation related to the Car Wash investigation to date.

To remind, Vitol’s U.S. subsidiary agreed to pay $164 million earlier this month to resolve U.S. government probes into alleged bribes the company paid in Brazil and other countries to boost its oil trading business. At the time, Vitol said that it does not tolerate corruption and is cooperating with the authorities.

The energy trader paid the Department of Justice (DOJ) a criminal penalty of $135 million to resolve the probes. Brazilian authorities will receive $45 million from that amount.

Vitol will also pay back the Commodity Futures Trading Commission (CFTC) over $12.7 million in ill-gotten gains, plus $16 million in fines.

At the time, Vitol CEO Russell Hardy said: “Vitol is committed to upholding the law and does not tolerate corruption or illegal business practices. As recognised by the authorities, Vitol has cooperated extensively throughout this process”.

As for Lava Jato, the Brazilian police have been investigating for years several major companies for the alleged use of bribes to win contracts with Petrobras.

Under this investigation, Vitol and its co-conspirators were accused of paying over $8 million to at least four Petrobras officials between 2005 and 2014.

The DOJ said that the company used “sham” consulting agreements, shell companies, and fake invoices with its co-conspirators to hide the schemes. Vitol also admitted to bribing or agreeing to pay over $2 million to officials in Ecuador and Mexico in other to secure and retain business there for oil products.

Prosecutors said the bribes went to employees at Mexico’s state-run Pemex and Ecuadorian state oil company Petroecuador.

Brazilian prosecutors also announced in late 2018 that they were investigating Petrobras’ oil deals with trading houses, including the world’s biggest oil traders – Vitol, Trafigura, and Glencore.