US, UK oil traders admit defrauding LyondellBasell of $80m

20 October 2011 20:30  [Source: ICIS news]

Oil traders admit defrauding LyondellBassellWASHINGTON (ICIS)--Two oil traders have pleaded guilty to defrauding LyondellBasell Industries and its Houston Refinery subsidiary of more than $80m (€58m) in an oil shipping conspiracy, the US Department of Justice said on Thursday.

The department said that oil traders Bernard Langley, 54, of the UK, and Houston, Texas, resident Clyde Meltzer, 65, admitted to conspiracy and wire fraud in a scheme that involved overcharging LyondellBasell and Houston Refinery for crude oil freight costs.

In a case that was brought to the attention of prosecutors by LyondellBasell, federal attorneys had alleged that Langley and Meltzer conspired with a LyondellBasell employee, Jonathan Barnes, to charge above-market shipping rates on the company’s crude oil imports from Venezuela.

Barnes, who pleaded guilty in March this year, had served as the marine chartering manager for LyondellBasell’s Houston refinery starting in 2006.

According to the department’s charges, beginning in late 2006 Barnes agreed to give chartering contracts to shipping companies that Langley and Meltzer had set up in the British Virgin Islands and elsewhere.

As part of the conspiracy, Langley and Meltzer charged LyondellBasell inflated crude oil freight rates over a four-year period, netting more than $80m in fraudulent profits, which they shared with Barnes in the kickback scheme.

The US attorney’s office in Houston said that Langley and Meltzer face up to 20 years each in federal prison and fines of up to $250,000. In addition, they will be liable for up to $57m in restitution.

Authorities have already confiscated real estate, jewellery, luxury automobiles, foreign bank accounts and other assets held by the three men.

Langley and Meltzer will be sentenced in a hearing scheduled for 26 January 2012.

They have been in federal custody since their arrest in December 2010.

($1 = €0.73)

By: Joe Kamalick
+1 713 525 2653

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