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December 15, 2023

Feds: Stamford company to pay $98M for foreign bribery scheme

PHOTO | Pixabay.com

Freepoint Commodities LLC, a Stamford-based commodities trading company, has agreed to pay more than $98 million to resolve a federal probe into its alleged involvement in a scheme to bribe Brazilian government officials to secure business with an oil company.

The U.S. Department of Justice has been investigating alleged violations of the Foreign Corrupt Practices Act. According to the U.S. Attorney’s office, the company bribed the officials in order to get business with Brazil’s state-owned and state-controlled oil company, Petróleo Brasileiro S.A., also known as Petrobras.

Vanessa Roberts Avery, U.S. Attorney for the District of Connecticut, said her office and federal law enforcement agencies are “keeping a watchful eye” on all U.S. businesses that operate overseas to ensure they comply with federal laws.

Freepoint has also entered into a three-year deferred prosecution agreement with the Justice Department in connection with a criminal information filed in the District of Connecticut, court documents show. This criminal information charges Freepoint with conspiracy to violate the anti-bribery provision of the Foreign Corrupt Practices Act, federal prosecutors said. 

Under a deferred prosecution agreement, if a company pays required penalties and abides by all terms, the government won’t pursue charges.

“This hefty financial sanction and deferred prosecution agreement should both serve as a deterrent to illegal conduct in the U.S. and abroad, and as a reminder that the Justice Department incentivizes those who report illegal conduct and work with us to correct wrongdoing,” Avery said in an announcement Thursday.

According to the government, Freepoint and its co-conspirators paid bribes for about six years, between 2012 and 2018, in exchange for confidential information about pricing and bids submitted by its competitors. Freepoint allegedly earned over $30 million in profits through the scheme.

In a statement on its website Thursday, Freepoint said it is fully committed to adhering to laws and regulations in jurisdictions where it operates.

The company indicated that it has “zero-tolerance for corruption,” and the individuals involved are no longer associated with it.

According to the company, it cooperated with authorities and has taken preventative measures.

“We have reviewed and strengthened our internal processes and training to prevent, and improve detection of, violations of our policies and will continue to evaluate the effectiveness of our procedures and controls on an ongoing basis,” the company’s statement said.

Three individuals face charges in relation to the scheme, including Glenn Oztemel, who worked as a senior oil trader at Freepoint; Gary Oztemel, his brother; and Eduardo Innecco, who worked as an agent for Freepoint. Their cases are pending in federal court. 

Back in 2018, Petróleo Brasileiro S.A. – Petrobras entered into agreements with U.S. and Brazilian officials to pay $853.2 million in penalties to resolve the U.S. government’s investigation into violations of the Foreign Corrupt Practices Act.

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