Thursday, August 29, 2019

Another Case of Freight Vessel Using Polluting Fuel Prosecuted by Maritime Authorities

Huge Fines and the Threat of Prison for Conspirators
Shipping News Feature
US – The US District Court of the Virgin Islands has convicted and sentenced Greek shipping companies, Ionian Shipping and Trading and Lily Shipping, along with individual ships officers from one of the tanker fleet, Stamatios Alekidis, Athanasios Pittas and Rey Espulgar, for various pollution, recordkeeping, and obstruction of justice crimes on the MT Ocean Princess after an elaborate conspiracy designed to hide the facts from the maritime authorities.

The defendants are accused of using fuel that exceeded the maximum allowable sulphur concentration in the US Caribbean Emission Control Area (ECA) and efforts to deceive US Coast Guard inspectors about the source of the fuel being used aboard the Ocean Princess.

The Ocean Princess was owned by Lily Shipping and operated by Ionian Shipping & Trading. The vessel was engaged in transporting petroleum products throughout the Caribbean including from Limetree Terminals, in St. Croix, Virgin Islands. The commercial manager of the vessel would authorise the Master of the vessel, Stamatios Alekidis, to transfer petroleum cargo from the cargo tanks into the fuel tanks. As the owner and operator of the vessel, Lily Shipping and Ionian Shipping & Trading were further responsible for ensuring the vessel used fuel that complied with the US Caribbean ECA standards.

While vessels are operating within the US Caribbean ECA, they must not use fuel that exceeds 0.10% sulphur by weight in order to help protect air quality. Between January 3, 2017, and July 10, 2018, the Ocean Princess entered into, and operated within, the US Caribbean ECA using fuel that contained excessive sulphur on 26 separate occasions. The fuel was petroleum cargo that had been transferred to the fuel tanks as authorised by the vessel’s commercial manager.

Once notification was received from Master Stamatios Alekidis, Chief Officer Rey Espulgar coordinated with Chief Engineer Athanasios Pittas to make the transfers from the cargo tanks to the bunker tanks. Espulgar then falsified the Oil Record Book, Part II, by failing to record that cargo had been transferred to the fuel tanks. Pittas also falsified the Oil Record Book, Part I, by falsely recording that the fuel in the bunker tank originated from a shore-side company in St. Martin, French West Indies. Additionally, Pittas created fictitious Bunker Delivery Notes that claimed the fuel in the bunkers came from that same shore-side company. Between March 2, 2016, and February 6, 2018, there were 19 separate fictitious of Bunker Delivery Notes being created on, and kept aboard the vessel.

US Coast Guard inspectors boarded the Ocean Princess on July 10, 2018, to conduct an inspection. During the inspection, the Coast Guard discovered that the vessel was using fuel with an excessive sulphur content. Espulgar instructed some of the lower-ranking crewmembers to lie to the inspectors about where the fuel came from and to say the ship took on fuel in St. Martin, when in fact it did not. Tyler Amon, Special Agent in Charge of EPA’s criminal enforcement program in the Virgin Islands, said:

“Ocean going vessels emit hazardous air pollutants or air toxics that are associated with adverse health effects impacting populations living near ports and coastlines. EPA, along with its law enforcement partners are committed to ensuring the shipping industry continues to comply with laws designed to protect air quality.”

Ionian Shipping & Trading and Lily Shipping will each pay a fine of $1.5 million be placed on four years of probation, and implement an Environmental Compliance Plan. Stamatios Alekidis, Athanasios Pittas, and Rey Espulgar were sentenced to three years of probation and ordered not to return to the United States on a ship during that time. Espulgar was also fined $3,000.

Photo: © Adrian Hobson