BRUSSELS – Global energy trader Gunvor Group has increased its provision for an expected fine from the U.S. Department of Justice (DOJ) to $650 million, while making just over $1 billion in the first nine months of the year, two sources familiar with the matter said.
The DOJ and U.S. Commodity and Futures Trading Commission (CFTC) have been investigating Gunvor’s business dealings in Ecuador and subpoenaed the company in 2020. A former Gunvor employee pleaded guilty in 2021 to what U.S. federal prosecutors called a scheme to bribe Ecuadorean government officials to win business.
Initially, the company set aside $200 million in 2022 but increased that amount to $450 million in June and has raised it again in its latest results, the two sources said.
Gunvor declined to comment on the provision.
The resolution of the probe was expected to be this year but is likely to take a few more months.
In the first nine months of the year, the company made $1.1 billion in net profit, taking into account the provision, and $2.8 billion in gross profits, the sources said, citing the company’s third quarter results which have not been published.
Gunvor is not alone in facing a DOJ probe, with the U.S. department investigating several major energy and commodity traders over the last five years.
Trafigura said this week it was setting aside $127 million to cover a possible DOJ fine.
Vitol, the world’s largest oil trader, was the first to settle, paying $164 million to the DOJ and CFTC in 2020 for bribing government officials in Brazil, Ecuador and Mexico.
Glencore agreed to pay $1.1 billion to the DOJ to resolve charges it paid bribes to win contracts over a decade in Nigeria, Brazil, Venezuela and the Democratic Republic of the Congo. Britain’s Serious Fraud Office separately fined Glencore 280 million pounds – about $310 million at the time – in 2022 for corruption in Africa.
($1 = 0.7952 pounds)
(Reporting by Julia Payne Editing by Mark Potter)
