GLENCORE PLEADS GUILTY TO CORRUPTION IN AFRICA
By Paul Ndiho
A Glencore subsidiary has pleaded guilty to multiple counts of bribery after admitting to giving inducements to African officials. The mining conglomerate anticipates paying over one-billion dollars to settle corruption and market manipulation violations.
A subsidiary of British mining and trading giant Glencore formally pleaded guilty to seven counts of bribery concerning oil operations in Cameroon, Equatorial Guinea, Ivory Coast, Nigeria, and South Sudan. The Swiss-based multinational company expects to pay up to $1.5 billion dollars to settle bribery and market manipulation wrongdoings. Subsidiaries in the U.S., Brazil, and Britain subsidiaries have now pleaded guilty to criminal offenses.
Glencore CEO Gary Nagle said in a statement issued to reporters. “We recognize there has been misconduct in this company historically. We’ve worked hard to correct that,”
U.S. Attorney General Merrick Garland in May said that a $1.1 billion agreement with the U.S. will resolve a decade-long scheme to bribe foreign officials across seven countries. And separate criminal and civil charges alleging one of the company’s trading arms manipulated oil prices at two of the largest U.S. shipping ports.
“The company has agreed to plead guilty in each case. With the first plea, Glencore has agreed to pay approximately $700 million in penalties for its decade-long scheme to bribe foreign officials in seven different countries. The second plea involves Glencore’s U.S. commodities trading arm, Glencore Limited, which used a scheme to manipulate fuel oil prices at two of the busiest commercial shipping ports in the United States over eight years. As a result, Glencore has agreed to pay approximately $485 million in penalties.”
Leonce Ndikumana, a professor of economics at the University of Massachusetts and co-author of the book “On the Trail of Capital Flight from Africa: the takers and the enablers” says in the last five decades, Africa has lost more than $60 Billion dollars, which is more than the continent has received in foreign aid, foreign direct investments and remittances to corruption.
“In the case of Angola, about one hundred and three billion dollars have evaporated from nineteen eighty-six to twenty eighteen through capital flight for Cote d’Ivoire. Over 50 billion dollars have left the country unaccounted for. And those represent resources that could have been used for development. So and what we find is that in these countries, there are institutional and economic factors that drive capital flight. In the case of South Africa, we profiled a phenomenon that is under scrutiny in the case, which is the state of the subject of state capture.
Ndikumana argues that African citizens should be concerned because the capital flight is funded and fueled by money from minerals and oil resources that belong to the African people, but end up enriching private individuals embezzling those funds.
“You find private individuals who are very powerful and. Connected with the party, the government was able to enrich themselves by leveraging corruption and bribery and networking with key individuals.”
Glencore Energy is to be sentenced in November after admitting to paying more than $28 million in bribes to secure preferential access to oil and generate illicit profits between 2011 and 2016.
The company still faces Swiss and Dutch investigations. But after sweeping changes that culminated in the exit of CEO and top shareholder Ivan Glasenberg in 2021, the November sentencing will likely wrap up a multi-national inquiry.