Glencore’s History of Market Manipulation and Bribery
By Tyson Slocum
On March 6, an affiliate of Switzerland-based Glencore applied for market-based rate authority in Federal Energy Regulatory Commission docket ER26-1652. Today we filed comments, noting that the application omits reference to significant enforcement actions against the company for criminal violations of bribery and market manipulation statutes. Market based rates are an incentive, and should only be granted to applicants that do not engage in fraud, deception or misrepresentation.
On May 24, 2022, the U.S. Commodity Futures Trading Commission and U.S. Department of Justice jointly issued a record-shattering $1.186 billion enforcement action against Glencore, finding that it engaged in years-long manipulation and foreign corruption of U.S. and global oil markets, including manipulation of four U.S. based S&P Global Platts physical oil benchmarks and related futures and swaps. Glencore pled guilty to criminal violations of federal law, including criminal violations of the Foreign Corrupt Practices Act, and criminal violations stemming from its manipulation of U.S. oil markets. Separately, on August 5, 2024 the Office of the Attorney General of Switzerland found Glencore guilty of criminal violations for bribery regarding a mining deal in the Democratic Republic of the Congo. And four Glencore oil traders face a criminal trial related to bribery schemes in West Africa, slated for trial in 2027.
Section 201 of the Federal Power Act declares “that the business of transmitting and selling electric energy for ultimate distribution to the public is affected with a public interest.” Courts have consistently determined that the primary aim of the Federal Power Act is to uphold the public interest and protect consumers from harm.
For decades, the Commission has stipulated that its market based rate authorities under Section 205 of the FPA are conditioned on an applicant’s conduct, determining that MBR applicants “will not engage in fraud, deception or misrepresentation. The provision of false, misleading or inaccurate information undermines the integrity of the FERC decision-making process, the smooth operation of markets and FERC’s ability to ensure just and reasonable rates for customers.”[9] The Commission should consider not granting market-based rate authority to applicants who have been recently sanctioned by government authorities for criminal violations of market manipulation and bribery statutes.
Read the full filing here GlencoreMBR