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Shipping company to pay $10.5M fine

A ship that dumped more than 40 tons of oil into the Atlantic was found to have an illegal discharge system

A ship that dumped more than 40 tons of oil into the Atlantic was found to have an illegal discharge system

The owner of a Hong Kong-based container ship agreed in December to pay a $10.5 million fine for dumping more than 40 tons of oil into the Atlantic last year, and attempting to cover it up.

In a federal plea agreement, MSC Ship Management (Hong Kong) Ltd. said it would pay the fine and plead guilty to federal charges of conspiracy, destruction of evidence and making false statements. Officials say the fine is the largest in which a single vessel has been charged with deliberate pollution, and the largest criminal fine paid in an environmental case in Massachusetts in at least 10 years.

“I believe that MSC Ship Management recognized the magnitude of their conduct by admitting to the illegal dumping and agreeing to the penalty,” says U.S. Attorney Michael J. Sullivan.

Peter Knight, a lawyer with LeBoeuf, Lamb, Greene & MacRae of Hartford, Conn. — which represented MSC Ship Management — says the company understands the consequences of its employees’ actions. “[MSC Ship Management] feels strongly that the plea agreement reflects its intention to accept full responsibility for the conduct of company personnel,” says Knight in a statement.

Coast Guard officials discovered an illegal oil discharge system and doctored records on the 663-foot ship Elena during a routine inspection in BostonHarborMay 16, 2005, according to the indictment. It charges that a steel pipe, referred to as the “magic pipe,” was used to circumvent the ship’s required pollution prevention equipment, and discharge oil sludge and oil-contaminated waste overboard. The indictment also states that senior MSC Ship Management officials in Hong Kong told crewmembers to lie to the Coast Guard, and that senior ship engineers ordered documents be destroyed and sealed. The dumping is said to have happened several times over a five-month period.

“What makes this incident even more egregious is that MSC Ship Management went so far as to manufacture a so-called ‘magic pipe’ to accomplish the crime,” says Sullivan, the U.S. Attorney.

Engine room operations aboard container ships like Elena produce waste oil and oil-contaminated bilge waste that needs to be treated on board and stored for incineration or offloading in port. Crews have been known to dump the waste to avoid paying fees associated with lawful disposal of the material. International and U.S. law prohibits the discharge of untreated waste, and requires that records be kept of all discharge activities.

The ship’s chief engineer, Mani Singh, pleaded guilty Dec. 20 to charges related to the illegal dumping and cover-up. Singh faces a maximum of five years in prison for conspiracy, five years for obstruction of justice, five years for violating the Act to Prevent Pollution from Ships, six years for making false statements, and 20 years for destruction of evidence, Sullivan says. He is to be sentenced March 8.

The ship’s second engineer, Aman Mahana, had pleaded guilty Dec. 1 to charges associated with the dumping and cover-up. He was to be sentenced in January.

MSC Ship Management, according to the federal agreement, will pay $10 million in a criminal fine and pay an additional $500,000 to community service projects teaching mariners how to report environmental crimes to the Coast Guard.

“Our hope is that this substantial $10 million fine will send a strong message to those in the maritime community who would try to circumvent our nation’s anti-pollution laws,” Sullivan says.