OSG to Pay $27m for Vessel Pollution

Thursday, March 22, 2007
Overseas Shipholding Group Inc. (OSG) pleaded guilty and was sentenced in federal court to pay $27m dollars 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 Admiral Timothy Sullivan.

In addition to the fine, OSG was sentenced to serve a three-year term of 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. 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 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 $37 million 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. At the sentencing hearing held today in Boston,

In imposing the sentence on OSG, Judge Lindsay granted a motion to award 12 current and former OSG crew members 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 $437,500 award is based on the fine imposed according to the Act to Prevent Pollution from Ships.

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