FOR IMMEDIATE RELEASE AT FRIDAY, JULY 18, 1997 (202) 616-2771 TDD (202) 514-1888 JUSTICE DEPARTMENT ACTS TO STOP COLLUSION AMONG THREE OIL TRADERS Settlement will Keep Firms from Exchanging Broker Commission Information WASHINGTON, D.C. -- The Department of Justice reached a settlement today with three major oil trading firms that will prohibit the companies from exchanging broker commission information involving contracts for Brent blend crude oil--a crude oil produced in the North Sea. The three colluding firms--AIG Trading Corporation, BP Exploration & Oil Inc. and Cargill International S.A.--discussed the information in order to lower the commissions they paid to brokers in the U.S. for these contracts, the Department said. As a result of today's settlement, the firms will no longer be able to conspire to reduce broker commissions. Joel I. Klein, Acting Assistant Attorney General in charge of the Department's Antitrust Division, said, "This case demonstrates the Antitrust Division's continuing commitment to investigate and prosecute agreements in the financial markets that violate the antitrust laws." A Brent spread contract is the simultaneous purchase and sale of two contracts, for different months forward, for Brent crude oil. A contract for difference, or CFD, is a commercial transaction based on the difference between the current published price for loaded Brent crude oil and the future price for Brent crude oil to be loaded on an unspecified future date. The trading firms had been paying separate full commissions to the brokers for both paired contracts and wanted to reduce the amount they paid. Broker commissions are paid for arranging the purchase and sale of Brent spread contracts and contracts for differences. The Department's Antitrust Division filed a civil complaint today against the companies in the U.S. District Court for the Southern District of New York in Manhattan. At the same time, the Department filed a proposed settlement that would resolve the lawsuit if approved by the court. The complaint alleges that AIG, BP, Cargill and others conspired from July 1992 through May 1993 to exchange current and prospective brokerage commission information on Brent spread contracts and CFDs in order to lower brokerage commissions paid to brokers in the U.S. Representatives of the companies carried out the conspiracy by telephone and in meetings in Europe and the U.S. Today's settlement prohibits AIG, BP, and Cargill from agreeing with any other trader to fix, lower, raise, stabilize or maintain any brokerage commission for Brent spread contracts and CFDs or exchange any information for these purposes. The companies will also be prohibited from requesting or advising other traders to lower, raise or change any brokerage commissions for Brent spread contracts and CFDs. AIG Trading Corp. is a subsidiary of AIG Trading Group Inc., which is a subsidiary of American International Group Inc. American International Group and its subsidiaries comprise a large diversified financial service organization operating in 130 countries and jurisdictions. AIG Trading is headquartered in Greenwich, Connecticut. BP Exploration & Oil is headquartered in Cleveland. Cargill International is headquartered in Geneva, Switzerland. As required by the Antitrust and Procedures and Penalties Act, the proposed stipulation and order will be published in the Federal Register, along with the Department's competitive impact statement. Any person may submit written comments concerning the proposed decree during a 60-day comment period to Ralph T. Giordano, Chief, New York Office, U.S. Department of Justice, Antitrust Division, 26 Federal Plaza, Room 3630, New York, New York 10278, 212-264-0390. At the conclusion of the 60-day comment period, the U.S. District Court for the Southern District of New York in Manhattan, may enter the consent decree upon finding it serves the public's interest. ### 97-299