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Two corporations pleaded guilty today in separate hearings in Baltimore for their role in managing and owning a ship engaged in deliberate discharges of waste oil and plastic garbage. The companies were each sentenced by U.S. District Judge Marvin Garbis to pay $1.2 million and serve three years of probation during which they will be required to implement a government approved environmental plan that includes audits conducted by an independent firm and review by a court appointed monitor.

A Marshall Islands corporation based in Greece, was the technical manager of a 33,005 gross ton newly built cargo ship, constructed in China and registered in Malta. The second company based in Denmark, was the owner of the vessel. Both corporations pleaded guilty today to four felony counts: obstruction of justice, making material false statements, and the environmental crimes of knowingly failing to maintain an accurate oil record book and knowingly failing to maintain an accurate garbage record book, both in violation of the Act to Prevent Pollution from Ships (APPS).

According to papers filed in court, senior ship engineers started dumping oil contaminated bilge waste on the ship’s very first voyage after it was completed in June 2010 in China. One method involved removing the blocking mechanism inside a valve so that waste could be pumped overboard. Another method involved a so-called “magic pipe” consisting of a long rubber hose and metal flanges welded together onboard to bypass required pollution prevention equipment.

The investigation began after an engineer complained to the U.S. Coast Guard when the ship arrived in Baltimore in February 2011. The crew member provided the Coast Guard with his cell phone containing 300 photographs showing how a magic pipe was being used to discharge sludge and oily waste overboard and to bypass the ship’s oily water separator, a required piece of pollution prevention equipment. Plastic garbage bags containing oil soaked rags were also dumped overboard. Under MARPOL, an international treaty to which the United States is a party and which is enforced by the APPS, ships must maintain an oil record book and a garbage record book in which all such discharges are recorded. Both defendants admitted to deliberately falsifying these required logs.

The ship’s Chief Engineer is currently incarcerated for his role. He pleaded guilty in December to obstruction of justice charges and was sentenced to three months in prison.

Both companies were sentenced to pay a total of $1.2 million. Of that amount, each defendant was ordered to pay $275,000 in organizational community service payments to the National Fish & Wildlife Foundation which will receive a total of $550,000 earmarked for projects involving Chesapeake Bay.

At the hearing today, the United States requested that the court issue an award to the whistleblower whose information led to the conviction of the defendants. The court did not rule on the matter today.

“The Justice Department will continue to vigorously prosecute the intentional dumping of oil and plastic from ships and falsification of ship records because they are serious crimes that threaten our precious ocean resources,” said Ignacia S. Moreno, Assistant Attorney General for the Environment and Natural Resources Division of the Department of Justice.

“The defendants dumped pollution into the ocean and falsified records to prevent the Coast Guard from learning about it,” said Rod J. Rosenstein, U.S. Attorney for the District of Maryland. “More than $500,000 of the penalty proceeds will fund conservation efforts for the Chesapeake Bay, our nation’s largest and most diverse estuary.”

“The Coast Guard’s objective when investigating violations and supporting these prosecutions is to ensure environmental stewardship is not optional and that deliberate violators are held accountable,” said Coast Guard Capt. Mark O’Malley, Captain of the Port of Baltimore. “This sentence includes a requirement that these defendants develop and implement a comprehensive environmental compliance program that will be monitored by third-party auditors. Our inter-agency efforts are not just aimed at punishing misconduct, they are aimed at fostering a safe, environmentally conscious and professional marine industry,”

“This case was resolved through excellent partnership between the regulatory and enforcement divisions of the U.S. Coast Guard, and also the dedicated pursuit of justice by the U.S. Attorney’s Office, Department of Justice and EPA-CID” said Otis E. Harris Jr., Special Agent-in-Charge, Coast Guard Investigative Service Chesapeake Region. “The Coast Guard Investigative Service is fully committed to investigating and resolving all criminal allegations of violations of environmental and regulatory statutes.”

“The oceans must be protected from those who circumvent laws by dumping wastes improperly,” said David G. McLeod, Special Agent in Charge of EPA’s criminal enforcement program in Maryland. “The defendants in this case directed the discharge of oily waste and garbage from their vessel into open water, ordered ship records to be falsified and lied to conceal these crimes. Today’s guilty pleas and sentences should send a strong message that we do not tolerate the flagrant violation of environmental laws and will work closely with our partners to vigorously prosecute those who despoil our environment.

Source: U.S. Department of Justice

Specifically, if the conditions discussed below are met, the Coast Guard can award “Disclosure Credit” and exercise its enforcement discretion and forego reporting the violation to the DOJ for prosecution. While the Policy is a positive development, it is not a panacea – the DOJ can still choose to prosecute environmental crimes cases without a referral from the Coast Guard. In addition, the Coast Guard may still recommend the prosecution of individual managers or employees.

Compliance Management System

The first step to qualification under the Policy is for a company to establish a compliance management system (“CMS”) to encourage employees to prevent, detect and correct violations of noncompliance on a daily basis. Due to the numerous variables which distinguish companies, there is no set format for a CMS, however, the Coast Guard will take several factors into account when assessing a particular company. Generally, the CMS must reflect a company’s due diligence in preventing, detecting and correcting violations. In accordance with the Policy, this is demonstrated by a CMS that contains:

• Policies and standards that will assist employees in meeting requirements under environmental laws, regulations, and other enforceable agreements;
• An assignment of overall responsibility within the company for compliance with policies and standards onboard each vessel;
• A system of monitoring and auditing that is designed to correct violations and a procedure for employees to report violations without fear of retaliation;
• A requirement for periodic evaluations of the CMS;
• A training program that effectively conveys the company’s standards and procedures to all employees;
• Incentives to managers and employees to act in accordance with the compliance policies, standards and procedures, including enforcement through disciplinary mechanisms; and
• Procedures to promptly correct any violation and to modify the system to prevent future violations.

 Awarding Disclosure Credit

Initially, any violation must have been discovered through either an environmental audit or an acceptable CMS as discussed above in order to qualify under the Policy. The Coast Guard will then consider eight separate factors in the exercise of its enforcement discretion and will award Disclosure Credit, the amount of which will determine the Coast Guard’s final action in a particular situation. These factors are summarized below:

• Voluntary Discovery – The violation must have been discovered voluntarily and not through legally mandated monitoring or sampling requirements under a statute, regulation, judicial or administrative order, or consent agreement.
• Prompt Disclosure – Violations must be reported within 21 calendar days. This time limit, however, is inapplicable if a statute or regulation requires that a report be made within a particular time limit. The 21-day limit is triggered when an officer or employee of the company “believes” that a violation may have occurred. This time can be expanded in situations where multiple vessels may have the same issue or when complex circumstances exist on a case-by-case basis.

• Discovery and Disclosure Independent of Government of Third Party Plaintiff – The violation must be discovered and disclosed to the Coast Guard before the commencement of a federal, state or local agency inspection or investigation; notice by a third party; the reporting of the violations to the Coast Guard or other government agency by a “whistleblower,” rather than by one authorized to speak on behalf of the company; or imminent discovery of the violation by a regulatory agency.
• Correction & Remediation – The violation must be corrected within 60 calendar days from the date of discovery, or as expeditiously as possible. In certain circumstances, the company may be required to enter into a written agreement, administrative consent order, or judicial consent decree where compliance or remedial measures are complex or a lengthy schedule is predicted.
• Prevent Recurrence – The company must agree to take steps to prevent recurrence of the violation after it has been disclosed. Preventive steps may include, but are not limited to, improvements to the company’s environmental auditing efforts or CMS.
• No Pattern of Violation – If the specific violation has occurred in the previous three years involving the same vessel or within the previous five years as part of a pattern involving multiple vessels, the company is barred from receiving Disclosure Credit.
• Other Violations Excluded – If the violation resulted in serious actual harm, or may have presented an imminent and substantial endangerment to human health or the environment, then the company will be unable to qualify for Disclosure Credit under the Policy.
• Cooperation – As with all interactions with governmental agencies, full cooperation is essential to receiving discretionary treatment.

Conclusion

The formal establishment of the Environmental Crimes Voluntary Disclosure Policy is significant in that companies that value compliance, and particularly environmental compliance, and have a stringent compliance program in place, are now at an advantage. Advice of counsel should be sought to verify that the CMS meets the requirements of the Policy, and in advance of a disclosure, to confirm the disclosure meets the requirements of the Policy. This will help ensure that the company and its employees are protected to the maximum extent possible when disclosing potential environmental crimes to the Coast Guard.

Source:

Blankrome LLP

Overnight on the 10th and 11th January 2011, yellow waxy balls of an unknown material washed ashore on the beaches of East and West Wittering. Samples were collected by the Environment Agency for analysis.

The Maritime and Coastguard Agency received information of problems onboard a Panamanian registered tanker. The vessel was boarded and inspected by MCA Port State Control Inspectors on the 25th January 2011. The inspection showed there had been problems in the handling of a previous cargo of Palm Oil. Small yellow waxy balls of material were seen scattered about the deck. Samples of the cargoes were taken and sent for testing by the Environment Agency. Also taken were copies of the ship’s logs and documentation.

A backtrack analysis showed that the Palm Oil that washed up on the beaches of the Solent on the 10/11th January 2011 originated from the Outer Nab Anchorage at a time when the vessel logs showed tank cleaning was in progress. Laboratory analysis showed that samples from the beaches and vessel were the same.

The evidence showed that the tank cleaning residues had not been disposed of in the approved manner.

District Judge Lucie said:

Taking into account all of the evidence I am satisfied so that I am sure that the polluting material came from the Pretty Time and I therefore find the case against the Defendant proved.

Douglas MacDonald, Head of Environmental & Emergency Response Standards at the MCA stated:”This is a timely reminder to all ship owners, ship managers and seafarers to ensure that residues of cargoes are disposed of in the approved manner.We would like to thank the Environment Agency for their help and co-operation in the investigation of this incident.”

Source:

Hellenikshipping.news

The company had previously pled guilty to one count of failure to maintain an accurate Oil Record Book, in violation of 33 U.S.C. § 1908(a); and one count of failing to submit reports to the National Ballast Information Clearinghouse, in violation of 16 U.S.C. § 4711(g)(2).

U.S. District Judge Adalberto Jordan sentenced the company to five years of probation and a $1,000,000.00 fine. As part of the corporation’s probation, the ship owner must complete an Environmental Compliance Plan in connection with eight ships in their fleet. Judge Jordan further directed that out of the $1,000,000.00 fine, $500,000.00 be directed to the South Florida National Parks Trust, a charitable and non-profit 501(c)(3) organization, for the benefit, preservation, and restoration of the environment and ecosystems of the waters of the United States in South Florida.

According to the factual proffer, the senteced comany operated the vessel from a terminal on the Miami River. On or about August 9, 2010, the U.S. Coast Guard embarked the vessel to conduct a port state control examination. They noticed excessive oil and diesel fuel leaking from various components of the ship’s main diesel engine. The Coast Guard asked the ship’s chief engineer to operate the ship’s Oil Water Separator, the pivotal equipment on board the ship for the management of oily waste. The Oil Water Separator did not function properly and gave inconsistent readings. The Coast Guard opened the Oil Water Separator’s content meter and observed that it contained untreated, viscous oil.

The Coast Guard then examined the vessel’s Oil Record Book. The Oil Record Book contained six fictitious entries showing purported usage of the Oil Water Separator that, in reality, had never occurred. Overall, the Oil Record Book did not provide any accounting for how the company and the crew of the vessel handled the ship’s oily waste.

The Coast Guard then examined a log in the engine room entitled, the “Night Orders Book.” An entry dated January 10, 2010 contained an order from the ship’s chief engineer to his staff to “Always pump out the bilge water. When finished, wash the pump with sea water for 20 minutes to clean out the line. If you don’t do it, you’ll bring pollution problems, especially in Miami.”

Finally, the vessel departed the waters of a foreign country and arrived in Miami on July 29, 2010, without making the required report to the National Ballast Information Clearinghouse. The National Ballast Information Clearinghouse is a joint program of the Smithsonian Environmental Research Center and the U.S. Coast Guard. Its mandate is to understand and prevent the introduction of non-indigenous species to the fresh, brackish, and saltwater environments of the United States.

Mr. Ferrer commended the investigative efforts of the U.S. Coast Guard and the U.S. Coast Guard Investigative Services. This case was handled by Assistant U.S. Attorney Jaime Raich.

Source: US Department of Justice

ISTKA will join forces with the Istanbul Technical University (ITU) to design a feasibility study to identify heavy polluters among strait traffic. Under the new legislation, suspect vessels will then be required to have their emissions measured by authorities, according to Turkey’s Today’s Zaman.

“We find this (project) essential and will be offering our support,” ISTKA Secretary-General, Abdulmecit Karatas, told Today’s Zaman on Monday.

“ISTKA currently plans to allocate TL 1 million to the project in the hopes of creating a functioning system for measuring maritime emissions and fining vessels deemed to be using “cheap and highly pollutant fuels,” he added.

The Bosphorus remains one of the most important shipping channels in the world and is journeyed by nearly 50,000 vessels each year.

However, the growing number of ships navigating the Bosphorus and its effect on the quality of Istanbul’s air is a matter of deep concern to both environmental campaigners and city officials.

Project coordinator and geology professor at the ITU, Tayfun Kindap, told Today’s Zaman that maritime emissions are a great threat to the inhabitants of Istanbul.

Source: SeaNews Turkey

Under the VGP, each company must open an account with the US Environmental Protection Agency (EPA). Part of that process is to designate a “Certifying Official” for the company account. The Certifying Official represents the company in matters pertaining to VGP compliance. Once the account is opened, the company must submit a Notice of Intent (NOI) for each vessel which will trade in the US.

Once the NOI is entered, the Certifying Official must certify each NOI and any subsequent changes to those NOI’s. When a ship is transferred to another company to manage or own, the company must submit a Notice of Termination (NOT) to remove the ship from their EPA account, and the new owner/ operator must submit a NOI to add the ship to their own account.

ECM has found that some service providers are listing themselves as the Certifying Official on all of their client accounts. While this makes it easier for the company since they do not have to be bothered with the certification process, it presents other problems later on. For instance, if they were to try and manage their VGP program themselves or select another service provider to do so for them, they would have to start the entire VGP/NOI process all over again from the start. Additionally, this method of certifying NOIs is completely invalid.

ECM has contacted the EPA for clarification and have been advised that this procedure is not in accordance with the VGP. A service provider may open an account for a client and also enter the NOI’s for the client’s ships, but the client must certify the NOI’s themselves. In certifying the NOI, the Certifying Official is certifying for the company that the company will maintain and operate their vessels in accordance with the requirements of the VGP. This is a legal document which could be used in future litigation should there be a significant compliance issue identified by the EPA.

ECM recommends that all vessel owners who trade to the US review their VGP compliance program to ensure that they have properly identified a Certifying Official for their company and that they have control of their own account with the EPA.

This seminar organized for all Confitarma members, provides important guidance to companies in devising or streamlining their own EMS, to meet the additional demands of US and potentially EU requirements, which in turn could provide protection under the US Coast Guard’s Voluntary Disclosure Policy for environmental violations.

Background

Since 2002, ECM Maritime Services, LLC (ECM) have been undertaken a variety of roles under Environmental Compliance Plans (ECPs) imposed upon vessel operators for APPS/MARPOL violations in US.  They continue to act in all the three assigned roles, i.e. the External Audit Group (EAG), Court Appointed Monitor (CAM) and Third Party Auditor (TPA) under several different ECPs.

Since 2005, ECM Europe has assisted ECM in conducting audits, inspections, ECP Manual preparation and training in Europe, as mandated under agreements reached between vessel operators and the U.S. DOJ.

Recently, this issue has become even more relevant following integration of the crime of Marine Pollution caused by Ships among those listed by Legislative Decree no. 231/01.

Since the steps taken by the US government to enforce ECPs may not be well understood in the industry, as well as the added implications of the recent EU Directive 2009/123/EC,  we are glad to present this one-day seminar on the subject, accompanied by valuable inputs from Registro Italiano Navale (RINA SpA), ECM Maritime Services LLC, Thomas Miller UK P&I, Messrs. Chalos, O’Connor and Duffy, LLP and Azimuth Srl.

Speakers

Achille Tonani is Head of Sustainability, Governance and Innovation Sector at RINA and will discuss the prevention of MARPOL violations in the light of current European and Italian legislation.

Michael F. Minogue and Nishit Kapoor are respectively the CEO and Sr. Vice President of ECM, with extensive experience in ECP implementation in the roles of EAG, CAM and TPA since 2002. During the seminar they will discuss the issues related to the criminalization by US authorities of ship operators and crew when alleged MARPOL/APPS violations are found to have occurred, including the steps required to ensure compliance with ECPs.

Michael G. Chalos is Senior Partner at Chalos O’Connor and Duffy, LLP specializing in the handling of MARPOL/APPS cases, representing ship-owners worldwide.

Richard Case is Senior Claims Director.  Richard joined Thomas Miller in 1985 having previously worked with solicitors. His work has been with South American, London-based Greek, Monegasque, Italian and Spanish Members.

Alessandro Palumbo is HR Director and Executive Certified Coach at AZIMUTH Srl – Strategic Consulting. He has developed and implemented Change Management, Goal Setting, Leadership, and Business Executive Coaching projects for several large and multinational organizations in Italy in the Automotive, TLC, Defense, Banking and Maritime fields.

Please do not hesitate to contact Bruno Di Lascio for any question or info about this Seminar.

Flyer

Parnter:  http://www.giovaniarmatori.it/

Steve has spent his professional career protecting California’s wildlife and natural environments, serving over 28 years in environmental law enforcement.

He began his career in 1982 as a law enforcement ranger with the National Park Service.

For more than 18 years, he has functioned in various capacities with the California Department of Fish and Game, including serving as the incident commander on hundreds of pollution events across the state. He also served as California’s incident commander during the M/V Cosco Busan oil spill response in San Francisco Bay during November 2007.

In 2008, then Governor Arnold Schwarzenegger appointed Steve as Administrator of California’s Office of Spill Prevention and Response (OSPR).

As Administrator, he oversaw more than 300 employees at OSPR, a program recognized as the premiere state spill response program in the nation.

Steve’s first official duty with ECM was to attend the Clean Gulf Conference in Austin, Texas November 30th – December 1st. Clean Gulf is North America’s largest oil spill training event and exhibition.

Participants included companies in the oil and chemical spill response sector, as well as the maritime security and marine salvage industries.

At Clean Gulf, Steve presented a case study involving a 4,000 gallon diesel fuel spill into the Smith River in Northern California in 2008. The spill, caused by a vehicle accident, created unique problems in an environmentally sensitive area. Steve’s presentation highlighted the need for planning and preparedness by the trucking industry and government agencies before a spill occurs. He also emphasized the need for companies that are at risk of oil spills to ensure that their insurance policies cover the response to and cleanup of a spill.

ECM trust its clients will agree that Steve’s background and professional experience working in California make him a perfect fit for ECM and his appointment is yet another example of our commitment to provide its clients with an unsurpassed level of quality and expertise.

Secondly, ECM’s former Manager of California Operations, Justin Likens, has been relocated to Houston office, Texas. As ECM’s vessel inspection and audit services continues to grow in leaps and bounds, Justin offered to transfer from California to Texas to assist the operations in Texas. He has already been a welcome addition there, enabling ECM to handle the increased workload while enhancing ECM’s  SMT capability.

And, finally with the addition of Steve, ECM has officially relocated California office from Irvine to Folsom, just outside of Sacramento and fairly close to the OSPR office. ECM’s new California office contact details are:

ECM Maritime Services, LLC

1024 Iron Point Road

Folsom, CA 95630

Telephone: 916-357-6785

The Company  was sentenced by a federal judge in Honolulu to pay a $1.1 million dollar fine . $250,000 of which will be used to improve Hawaii’s coral reefs.

The company admitted to dumping oily bilge waste into the waters off Hawaii, and tried to cover it up by falsifying the ship’s record book.

Source:

Khon2