
OSG vessels illegally discharged sludge and oily waste and deliberately concealed the pollution through the use of false Oil Record Books, a required log regularly inspected by the U.S. Coast Guard when the ships were in U.S. ports. Discharges were also concealed by other means, such as by making discharges at night, painting flanges on overboard piping to hide marks caused by the use of bypass pipes, and hiding bypass equipment during port calls. In other instances, pollution prevention equipment known as an oily water separator was “tricked” by flushing a sensor designed to detect oil with fresh water during overboard discharges. Criminal violations continued on some ships during the three years in which OSG was under investigation, including six vessels on which OSG self-reported violations.
The multi-district investigation and prosecution was conducted in Boston, Massachusetts.; Portland, Maine; Los Angeles, California; San Francisco, California; Wilmington, North Carolina; and Beaumont, Texas. The $37 million penalty included a $27.8 million criminal fine (of which $800,000 is dedicated by statute to the Oil Spill Liability Trust Fund to clean up future oil spills), and $9.2 million in organizational community service payments for marine environmental projects.