News and Press Releases

FOR IMMEDIATE RELEASE:

Tuesday - June 8, 2010

SHIP MANAGEMENT FIRM PLEADS GUILTY

AND IS SENTENCED FOR VIOLATING FEDERAL POLLUTION LAW

RALEIGH - United States Attorney George E.B. Holding announced that in federal court today agents of COOPERATIVE SUCCESS MARITIME, S.A., the operator and owner of the M/T Chem Faros, a 21,145 gross-ton ocean-going cargo ship that regularly transported cargo between various ports in Asia and the United States pled guilty for violating the Act to Prevent Pollution from Ships (APPS), in violation of Title 33, United States Code, Sections 1901 and to making material false statements, in violation of Title 18, Untied States Code, Section 1001(a)(3).

United States District Judge James C. Dever, III, sentenced the company to pay a $850,000 penalty of which $158,000 will be paid to the congressionally created National Fish and Wildlife Fund as a community service payment. The judge also sentenced the company to serve five years of probation, during which time they will implement an environmental compliance plan.

A Criminal Information was filed on May 5, 2010.

Consistent with requirements in the APPS regulations, a vessel other than an oil tanker, must maintain a record known as an Oil Record Book in which transfer and disposal of all oil-contaminated waste and the discharge overboard and disposal otherwise of such waste, must be fully and accurately recorded by the person in charge of the operations. Oil-contaminated bilge waste can be discharged overboard if it is processed through on-board pollution prevention equipment known as the Oily Water Separator (OWS), which is used to separate the water from the oil and other wastes, and the effluent contains 15 parts per million or less of oil.

During a regular inspection of the ship on March 29, 2010, in Morehead City, N.C., an oiler with the engine crew passed a note to a U.S. Coast Guard inspector. The handwritten note stated:

“GOOD MORNING SIR, I WOULD LIKE TO LET YOU KNOW THIS SHIP DISCHARGING BILGE ILEGALLY USING BY MAGIC PIPE, IF YOU WANT TO KNOW ILLEGAL PIPE THERE IN WORKSHOP FIVE METERS LONG WITH RUBBER. SIR, I HOPE IF YOU DON’T MIND. WE HAVE A SECURITY FOR OUR SAFETY.” (spelling errors in original).

The oiler informed a member of Coast Guard boarding team that the “magic pipe” was located in the workshop in the engine department. The subsequent investigation revealed that from September 2009, through March 2010, engine department crew members pumped oil-contaminated waste directly overboard by using the pipe that by-passed the OWS on several occasions, up to 10 times according to some crew members.

On March 18, 2010, the chief engineer, Vaja Sikharulidze, ordered the engine department crew members, through the second engineer, to by-pass the OWS and discharge oil-contaminated bilge waste directly overboard. This resulted in approximately 13,200 gallons of oil-contaminated waste to be discharged into the ocean.

Sikharulidze has acknowledged making false entries in the oil record book to hide the true amount of oil-contaminated bilge waste that was stored in a certain tank aboard the ship. The chief engineer stated that in order to hid the by-pass of over 70 cubic meters, he had to enter incorrect information in the ORB preceding the discharge.

Sikharulidze further admitted that transfer entries in the ORB from on or about March 6, 2010, through March 17, 2010, were false. He indicated he was continuing the practice of false entries made by the prior chief engineer for that particular tank. He explained that the prior chief engineer indicated in the ORB that a particular bilge tank contained 24 cubic meters of waste when, in fact, it contained 60 to 65 cubic meter of waste. In order to avoid bringing attention to the false entries, the chief engineer continued the practice of making false entries.“Today’s sentence appropriately punishes Cooperative Success for violating the law. The Justice Department working in a coordinated effort with our partner agencies will continue to prosecute companies that ignoremaritimelaws and ultimately harm the environment,” said Ignacia S. Moreno, Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.

“Pollution prevention acts were put in place to protect our natural resources. It is disheartening when we see companies and individuals knowing and purposely dumping toxins into those resources. We will take violations of these acts very seriously, in order to protect our natural resources for future generations,” stated Mr. Holding.

“The oceans must be protected from being used as dump sites for waste oil or other hazardous substances," said Maureen O'Mara, Special Agent-in-Charge of EPA's criminal enforcement program in Atlanta. "This prosecution sends a clear message that companies that refuse to operate their vessels safely and lawfully and pollute our waters will be vigorously prosecuted.”

"As a steward of the environment, the Coast Guard enforces compliance with applicable laws," said Rear Adm. Wayne Justice, commander of the Coast Guard's 5th District. "The criminal prosecution of violating companies is a significant deterrent for offending ships entering our ports. Cooperative efforts between state and federal agencies help preserve our natural resources, and protect those who rely on the marine environment for their livelihood."

Investigation of this case was conducted by the United States Coast Guard, the Coast Guard Investigative Service and the Environmental Protection Agency with assistance from the Federal Bureau of Investigation Computer Forensic Team. Assistant United States Attorney Banumathi Rangarajan and Trial Attorney Shenni Patel with the Department of Justice Environmental Crimes Section represented the government.

News releases are available on the U. S. Attorney’s web page at www.usdoj.gov/usao/nce within 48 hours of release.

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