Connecticut Oil Trader Convicted in Petrobras Bribery Scheme

In a significant development in the ongoing fight against international corruption, a Connecticut jury has found Glenn Oztemel guilty on all seven counts related to a long-running bribery scheme involving Petrobras, Brazil's state-owned oil giant. The verdict, delivered on September 26, 2024, marks a crucial milestone in a case that has exposed the dark underbelly of global oil trading.

Oztemel, a 65-year-old resident of Westport, Connecticut, was convicted of money laundering, conspiracy, and violating the Foreign Corrupt Practices Act. The scheme, which operated from 2010 to 2018, involved paying over $1 million in bribes to Petrobras officials to secure contracts and obtain confidential information for two Connecticut-based trading companies, Arcadia Fuels and Freepoint Commodities.

Prosecutors revealed that the defendants used coded language such as "breakfast" and "freight deviation" to discuss bribe amounts, highlighting the sophisticated nature of the operation. The illicit payments were reportedly split between Petrobras officials in Brazil and Rodrigo Berkowitz, a Petrobras fuel trader based in Houston.

This case is part of the broader fallout from Operation Car Wash, a sweeping investigation that uncovered billions of dollars in bribes and overcharges within Petrobras. The scandal, which ran from approximately 2014 to 2021, had far-reaching consequences, including the impeachment of Brazilian President Dilma Rousseff in 2016 and a staggering 85% drop in Petrobras' market value between 2014 and 2015.

Founded in 1953 as a state-owned monopoly, Petrobras has grown to become Brazil's largest company by market capitalization. The firm operates in 25 countries across five continents and produces about 2 million barrels of oil equivalent per day. Despite its size and influence, Petrobras has faced numerous challenges, including environmental controversies and the corruption scandal that has tarnished its reputation.

The conviction of Oztemel is not an isolated incident. His brother, Gary Oztemel, pleaded guilty to a related money laundering charge in June 2024. Additionally, Freepoint, based in Stamford, Connecticut, entered a deferred prosecution agreement in December 2023, agreeing to pay over $98 million to resolve related U.S. bribery charges.

Petrobras has taken steps to address the fallout from the corruption scandal. In 2018, the company agreed to pay $2.95 billion to settle a U.S. class action lawsuit. Moreover, Petrobras has been investing heavily in renewable energy sources and maintains a significant presence in the biofuels market, particularly ethanol.

The case against Oztemel and his co-conspirators highlights the ongoing challenges in the global energy sector. While Petrobras continues to be a leader in deep-water oil exploration and production technology, operating 13 refineries in Brazil with a total capacity of 2.2 million barrels per day, the company's involvement in corruption scandals has overshadowed its technological achievements.

As the legal proceedings continue, with Eduardo Innecco awaiting extradition from France and Rodrigo Berkowitz's sentencing still pending, the oil industry watches closely. The outcome of these cases may have lasting implications for international business practices and the fight against corruption in the energy sector.

"We are very disappointed in today's verdict. Glenn has had an unblemished record for 40 years in the oil industry, and we will continue to fight to clear Glenn's good name."

The conviction of Glenn Oztemel serves as a reminder of the ongoing efforts to combat corruption in international business. As Petrobras works to rebuild its reputation and invest in sustainable energy solutions, the global community continues to grapple with the challenges of ensuring transparency and ethical practices in the oil and gas industry.