Trafigura agrees to pay $55 million to settle US CFTC probe

The giant commodities group Trafigura has agreed to pay $55m to settle the US Commodity Futures Trading Commission (CFTC) investigation into alleged historical conduct. Trafigura made it clear that neither admits nor denies the allegations.

One of the world’s largest charterers of vessels, Trafigura, responsible for more than 5,000 voyages a year with around 400 ships currently under management, said its Trafigura Trading LLC has reached a civil settlement with the US Commodity Futures Trading Commission (CFTC).

Under the terms of the agreement with the CFTC, Trafigura Trading LLC will pay a civil monetary amount of $55m to settle the CFTC’s investigation into alleged historical conduct, which Trafigura neither admits nor denies.

The settlement refers to the following conduct that has been alleged by the CFTC: Ambiguity in Trafigura’s employment agreements that failed to clarify the scope of certain contractual non-disclosure provisions, misappropriation of material non-public information from a Mexican trading entity that took place five or more years ago and reckless conduct in the purchase of USGC fuel oil in the Platts eWindow in February 2017, which benefitted Trafigura’s derivatives position.

The company also said that since the period in question it has voluntarily undertaken significant steps to enhance its compliance programme, including, but not limited to developing and implementing enhanced, risk-based policies and procedures relating to market integrity; enhancing processes and controls around communications relating to market activity; investing additional resources in employee training and compliance testing; and enhancing ongoing compliance monitoring and controls testing processes.

In a statement released Monday, Trafigura added that it had “agreed to modify the non-disclosure provisions in its employment, termination, and severance agreements to include language making clear that nothing in those provisions should be understood to limit or prevent communications with governmental authorities about potential violations of law.”