As Arntzen is feted, OSG hit with $27 million fine
On the same day the Connecticut Maritime Association feted Overseas Shipholding Group's chief executive by presenting him with its “Commodore” award, the company was socked with a $27 million fine for pollution violations.
Overseas Shipholding was sentenced in federal court to pay $27 million for violations in Boston; Portland, Maine; Los Angeles; San Francisco; and Wilmington, N.C., announced Acting Assistant Attorney General Matthew J. McKeown, U.S. Attorney Michael J. Sullivan for the District of Massachusetts, and U.S. Coast Guard Rear Adm. Timothy Sullivan.
In addition to the fine, OSG was sentenced to serve three years probation during which it must implement and follow a stringent environmental compliance program that includes a court-appointed monitor and outside independent auditing of OSG ships trading worldwide.
The U.S. Attorney said that in January OSG pleaded guilty to additional charges in Beaumont, Texas, and is awaiting sentencing in that case, for which it has agreed to pay another $10 million.
The U.S. Justice Department said the total $37 million plea agreement is the largest-ever involving deliberate vessel pollution. The charges involving 12 OSG oil tankers range from June 2001 to March 2006 and include violations of the Clean Water Act as amended by the Oil Pollution Act of 1990, the Act to Prevent Pollution from Ships, conspiracy, false statements, and obstruction of justice. The proposed penalty includes a $27.8 million criminal fine, which will be divided among the districts, and a $9.2 million organizational community service payment that will fund various marine environmental projects coast to coast.
In imposing the sentence on OSG, Judge Reginald Lindsay granted a motion to award 12 current and former OSG crewmembers with $437,500 each for their role in blowing the whistle on illegal conduct. The provision for a whistleblower award is set forth in the Act to Prevent Pollution from Ships, and provides that individuals providing information leading to conviction may be awarded up to half of a criminal fine.
The company said last year it had reserved $37 million in anticipation of fines reached for settlement of the charges.
In December, announcing the settlement, Morten Arntzen, OSG's CEO, said the company “worked hard to correct the issues” that resulted in a settlement with the Justice Department.
Arntzen was made the CMA’s Commodore during a diner Wednesday night that climaxed the association’s annual three-day conference.
As Arntzen is feted, OSG hit with $27 million fine
